MERRILL LYNCH
GLOBAL
RESOURCES
TRUST
STRATEGIC
Performance
[GRAPHIC OMITTED]
Semi-Annual Report
January 31, 1999
<PAGE>
MERRILL LYNCH GLOBAL RESOURCES TRUST
DEAR SHAREHOLDER
During the three-month period ended January 31, 1999, Merrill Lynch Global
Resources Trust delivered improved relative performance compared to its peer
group of resource funds. While the net asset value of the Trust's Class B Shares
declined 7.1% in the January quarter, this was better than the 11.7% decline
registered by the peer group average as measured by the Lipper Natural Resource
Fund Average and the 9.7% drop in the unmanaged J.P. Morgan Commodity Index. For
the 12-month period ended January 31, 1999, the total return of the Trust's
Class B Shares exceeded the Lipper Natural Resource Fund Average by 7 percentage
points. (Trust results shown do not reflect sales charges and would be lower if
sales charges were included. Complete performance information can be found on
pages 3 and 4 of this report to shareholders.)
Obviously, the Trust's negative total return for the 12-month period ended
January 31, 1999 is disappointing. However, the extremely poor environment for
commodity investments in 1998, as represented by the recent 23-year low in the
Commodity Research Bureau Price Index, masked what we considered to be positive
structural changes in the Trust. While continued commodity deflation remains a
risk, we believe that the potential risk and reward of owning resources stocks
is shifting to a more positive outlook. We believe our emphasis on stocks that
have exposure to commodities with positive capacity utilization trends gives the
Trust the potential to achieve both positive absolute and relative total returns
over a one-year-two-year investment horizon.
During the quarter ended January 31, 1999, the declines of the Trust's total
returns reflected the continued erosion of commodity prices. The environment
facing our increased energy investments was particularly poor. Members of the
Organization of Petroleum Exporting Countries (OPEC) continued to lack the
resolve to meet their oil production quota targets. This surplus production
coincided with a second consecutive warm winter in North America, resulting in
oil prices reaching levels not seen in 13 years. Moreover, the traditional
stability offered by our increased holdings of large-capitalization integrated
oil companies appeared at risk, as all three components of their integrated
operations -- upstream hydrocarbon production, refining and chemical production
- -- faced poor profit margin outlooks for the first half of 1999. The warm
weather has particularly hurt our investments in natural gas exploration and
production companies. Heating degree data to date indicates that this winter is
11.7% warmer than normal. If this trend continues, it could exceed even last
year's record warm winter season. Natural gas in storage was 462 billion cubic
feet (BCF) above last year's levels through the middle of February, and over 700
BCF above average storage levels for this time of year. At this point, it is
highly unlikely that this surplus will be significantly reduced by the end of
the heating season. Therefore, we expect natural gas prices to be under pressure
until well into the next heating season.
Nonetheless, we remain committed to our investments in North American natural
gas. The use of new technologies to exploit natural gas production, combined
with the shrinking size of new field discoveries, has resulted in a steep
depletion rate for North American natural gas supplies. Industry studies
estimate that up to 70% of US gas supplies are depleting at a pace of 30% per
year. To maintain ample gas production, the industry should be increasing the
pace of drilling. However, the Baker Hughes rig count was recently at a 54-year
low. The current low oil and gas prices have dramatically lowered oil company
cash flows, and drilling budgets are being slashed as a result. Apache
Corporation projects that its North American natural gas production will fall
from 400 million cubic feet per day (MMCFD) to 340 MMCFD because of reduced
capital spending. Similar cuts and results are being reported at other
companies. Moreover, capital spending will be further constrained because debt
levels have expanded sharply throughout the industry. The majority of
smaller-capitalization oil and gas producers now have debt-to-total
capitalization ratios exceeding 50%. Therefore, we believe any rebound in
drilling will be muted as
1
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
gas prices recover, since these companies will have to repair their balance
sheets. The combination of reduced drilling and rapid depletion of existing gas
fields could result in a recovery in the price of natural gas, possibly as early
as the next heating season.
During the three-month period ended January 31, 1999, we continued to focus on
natural gas production companies with long reserve lives and strong financial
positions. New holdings in the Trust included Canadian gas producers Rio Alto
Exploration Ltd. and Canadian Hunter Exploration Ltd. We have also added a
position in Anadarko Petroleum Corporation, the independent oil company with
both North American natural gas exposure and large international oil discoveries
and reserves. During the January quarter, we dramatically reduced our holdings
in Snyder Oil Corporation. The company's merger with Santa Fe Energy Resources
Ltd. diluted its exposure to our North American natural gas thesis.
Offsetting the poor environment for oil and oil service stocks was a rebound in
some of the Trust's globally diversified resource investments. Holdings in
plantation, forest products and steel shares appreciated during the three months
ended January 31, 1999. In addition, consolidation activity again helped the
Trust. Mobil Corporation shares appreciated after the announced merger with
Exxon Corporation Shares of Argentine oil producer YPF Sociedad Anonima rose as
takeover speculation increased with the sale of all but 5.3% of the Argentine
government stake. We increased our holding in Smurfit-Stone Container
Corporation, the shares of which soared 36% upon completion of the merger
between Stone Container Corp. and Jefferson Smurfit Inc. The Trust also
benefited from the acquisition of Getchell Gold Corp. by Placer Dome Inc.,
although the Trust's gain in the former was largely offset by a fall in Placer
Dome Inc.'s shares over concerns that the company had overpaid for Getchell Gold
Corp.
During the three-month period, we continued to pare the Trust's holdings in the
gold sector, although we remain overweighted in gold. After a spectacular rise
last September, gold stocks surrendered much of their gains. As inflation
continues to abate to levels not seen in 30 years, the world has become
increasingly concerned with deflation fears. The collapse of the Brazilian
currency put further pressure on commodity prices, with the price of gold
retreating to the bottom of its recent $280 - $300 per ounce trading range. The
World Economic Council reported that gold demand rebounded late last year.
However, there are ongoing concerns about central bank sales, and the gold
industry has been slow to close high-cost capacity. Consequently, we eliminated
our Great Central Mines Limited holding as it appreciated prior to a merger bid
by Normandy Mining Limited. We will likely continue to sell some of our gold
holdings coincident with gold price rallies, although we intend to maintain a
position in the range of 5% to 10% of net assets. This would provide a hedge
should the rapid increase in global monetary aggregates and lower global
interest rates somehow spark inflation or debase faith in world currencies.
Throughout the January quarter, we continued to be watchful about the resolution
of the world economic situation. In early February, The World Bank stated
concerns that world commodity prices may not fully recover from their historic
lows. At its recent meeting, the Group of Seven industrialized nations said that
despite some positive trends in Asia, the overall outlook for world economic
growth had deteriorated. At present, the amazing resilience of the United States
economy has been the holdout against slowing world economic conditions. The
failure of Japan to enact concrete regulatory reforms and provide fiscal
stimulus is one of the keys to avoiding a global deflationary spiral, in our
opinion. Tax cuts, similar to those passed by the United States in the early
1980s, could provide the economic stimulus needed to rescue Japan from its near
decade-long recession. However, there have been few signs of serious reform to
date. The management of some companies have reported that European economic
growth is also slowing after the Brazilian economic crisis, and the new members
of the European Economic and Monetary Union may also need to take some action.
Without help from Japan and Europe in stimulating internal demand, the United
States may not remain an island of prosperity.
Natural resource investments suffered severe declines since this crisis began
back in July 1998, with the total return of the average resource fund dropping
by 24% in 1998. However, adverse conditions seem to be largely discounted in
current resource stock valuations. While many stock indexes rebounded and made
new highs, the shares of commodity stocks now trade at price-to-sales ratios
that are at historic 35-year lows. Some metals stocks are trading at or below
their book values per share, and the integrated oil stocks possess historically
high
2
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
yields relative to the overall stock market. Typically, valuations at these
levels have been good entry points for resource investments. The consolidation
trend within resource sectors should be an additional positive dynamic over a
longer-term horizon. Further global economic slowing, especially if it extends
to the United States, could depress resource sector results and share prices.
However, the depressed valuations reflected by the shares could result in
resource investments providing better relative returns than the overall stock
market indexes.
In Conclusion
The actions we took over a year ago resulted in improved results relative to the
peer group of resources funds. We continue to focus on attractively valued,
financially strong companies with exposure to commodities that are subject to
rising capacity utilization trends. We continue to believe that this mitigates
risk in economic contractions, while enabling Trust investments to appreciate in
economic expansions.
We appreciate your investment in Merrill Lynch Global Resources Trust, and we
look forward to sharing our investment outlook and strategies with you in our
next report to shareholders.
Sincerely,
/s/ Terry K. Glenn
Terry K. Glenn
Executive Vice President
/s/ Robert M. Shearer
Robert M. Shearer
Senior Vice President and Portfolio Manager
March 3, 1999
PERFORMANCE DATA
About Fund Performance
Investors are able to purchase shares of the Trust through the Merrill Lynch
Select Pricing(SM) System, which offers four pricing alternatives:
o Class A Shares incur a maximum initial sales charge (front-end load) of
5.25% and bear no ongoing distribution or account maintenance fees. Class
A Shares are available only to eligible investors.
o Class B Shares are subject to a maximum contingent deferred sales charge
of 4% if redeemed during the first year, decreasing 1% each year
thereafter to 0% after the fourth year. In addition, Class B Shares are
subject to a distribution fee of 0.75% and an account maintenance fee of
0.25%. These shares automatically convert to Class D Shares after
approximately 8 years. (There is no initial sales charge for automatic
share conversions.)
o Class C Shares are subject to a distribution fee of 0.75% and an account
maintenance fee of 0.25%. In addition, Class C Shares are subject to a 1%
contingent deferred sales charge if redeemed within one year of purchase.
o Class D Shares incur a maximum initial sales charge of 5.25% and an
account maintenance fee of 0.25% (but no distribution fee).
None of the past results shown should be considered a representation of
future performance. Figures shown in the "Recent Performance Results" and
"Average Annual Total Return" tables assume reinvestment of all dividends
and capital gains distributions at net asset value on the ex-dividend
date. Investment return and principal value of shares will fluctuate so
that shares, when redeemed, may be worth more or less than their original
cost. Dividends paid to each class of shares will vary because of the
different levels of account maintenance, distribution and transfer agency
fees applicable to each class, which are deducted from the income
available to be paid to shareholders.
3
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
PERFORMANCE DATA (concluded)
Average Annual Total Return
% Return Without % Return With
Sales Charge Sales Charge**
================================================================================
Class A Shares*
================================================================================
Year Ended 12/31/98 -15.08% -19.54%
- --------------------------------------------------------------------------------
Five Years Ended 12/31/98 - 0.87 - 1.94
- --------------------------------------------------------------------------------
Ten Years Ended 12/31/98 + 3.69 + 3.13
- --------------------------------------------------------------------------------
* Maximum sales charge is 5.25%
** Assuming maximum sales charge.
% Return % Return
Without CDSC With CDSC**
================================================================================
Class B Shares*
================================================================================
Year Ended 12/31/98 -15.98% -19.34%
- --------------------------------------------------------------------------------
Five Years Ended 12/31/98 - 1.91 - 1.91
- --------------------------------------------------------------------------------
Ten Years Ended 12/31/98 + 2.62 + 2.62
- --------------------------------------------------------------------------------
* Maximum contingent deferred sales charge is 4% and is reduced to 0% after
4 years.
** Assuming payment of applicable contingent deferred sales charge.
================================================================================
% Return % Return
Without CDSC With CDSC**
================================================================================
Class C Shares*
================================================================================
Year Ended 12/31/98 -15.95% -16.79%
- --------------------------------------------------------------------------------
Inception (10/21/94)
through 12/31/98 - 3.46 - 3.46
- --------------------------------------------------------------------------------
* Maximum contingent deferred sales charge is 1% and is reduced to 0% after
1 year.
** Assuming payment of applicable contingent deferred sales charge.
================================================================================
% Return Without % Return With
Sales Charge Sales Charge**
================================================================================
Class D Shares*
================================================================================
Year Ended 12/31/98 -15.28% -19.73%
- --------------------------------------------------------------------------------
Inception (10/21/94)
through 12/31/98 - 2.69 - 3.93
- --------------------------------------------------------------------------------
* Maximum sales charge is 5.25%.
** Assuming maximum sales charge.
Recent Performance Results*
<TABLE>
<CAPTION>
Ten Years/
12 Month 3 Month Since Inception
Total Return Total Return Total Return
===================================================================================================================
<S> <C> <C> <C>
ML Global Resources Trust Class A Shares -17.13% -6.86% +26.74%
- -------------------------------------------------------------------------------------------------------------------
ML Global Resources Trust Class B Shares -18.04 -7.06 +14.25
- -------------------------------------------------------------------------------------------------------------------
ML Global Resources Trust Class C Shares -17.99 -7.44 -16.84
- -------------------------------------------------------------------------------------------------------------------
ML Global Resources Trust Class D Shares -17.38 -6.89 -13.92
===================================================================================================================
</TABLE>
* Investment results shown do not reflect sales charges; results would be
lower if a sales charge was included. Total investment returns are based
on changes in net asset values for the periods shown, and assume
reinvestment of all dividends and capital gains distributions at net asset
value on the ex-dividend date. The Fund's ten-year/since inception periods
are Class A & Class B Shares, for the ten years ended 1/31/99 and Class C
& Class D Shares, from 10/21/94 to 1/31/99.
4
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
SCHEDULE OF INVESTMENTS
<TABLE>
<CAPTION>
Value Percent of
Industries Shares Held Common Stocks Cost (Note 1a) Net Assets
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Aluminum 11,925 Alcoa Inc. $ 645,945 $ 997,228 1.3%
19,400 Pechiney, S.A. (A Shares) 782,024 660,454 0.9
------------ ------------ ----
1,427,969 1,657,682 2.2
- -------------------------------------------------------------------------------------------------------------------------------
Chemicals 28,000 Air Products and Chemicals, Inc. 630,826 941,500 1.2
16,000 duPont (E.I.) de Nemours and Company 631,592 819,000 1.1
29,000 Imperial Chemical Industries PLC (ADR) (a) 1,418,032 1,042,188 1.4
------------ ------------ ----
2,680,450 2,802,688 3.7
- -------------------------------------------------------------------------------------------------------------------------------
Diversified 102,000 Asahi Glass Company, Limited 1,223,974 610,526 0.8
Companies 27,000 Ashland Inc. 1,144,672 1,282,500 1.7
------------ ------------ ----
2,368,646 1,893,026 2.5
- -------------------------------------------------------------------------------------------------------------------------------
Gold 797,100 Acacia Resources Limited 1,280,689 1,226,418 1.6
94,500 Ashanti Goldfields Company Ltd. (GDR) (b) 2,346,106 805,613 1.1
122,500 Cambior Inc. 1,625,848 600,331 0.8
599,200 Delta Gold N.L. 1,054,663 929,455 1.2
373,800 + Miramar Mining Corporation 1,900,432 272,305 0.4
19,222 Newmont Mining Corporation 707,254 339,989 0.4
920,000 Normandy Mining Limited 1,040,108 798,464 1.0
211,000 Placer Dome Inc. 4,483,800 2,360,562 3.1
1,097,000 Resolute Limited 2,284,526 792,253 1.0
------------ ------------ ----
16,723,426 8,125,390 10.6
- -------------------------------------------------------------------------------------------------------------------------------
Integrated Oil 8,700 Amerada Hess Corporation 481,488 413,250 0.5
Companies 89,100 BP Amoco PLC 360,693 1,202,751 1.6
19,320 BP Amoco PLC (ADR) (a) 816,651 1,567,335 2.0
30,400 Chevron Corporation 2,524,866 2,272,400 3.0
42,700 ENI (ADR) (a) 1,996,225 2,562,000 3.4
43,100 Elf Aquitaine S.A. (ADR) (a) 1,586,637 2,354,338 3.1
11,900 Exxon Corporation 849,171 838,206 1.1
21,600 Mobil Corporation 1,703,721 1,894,050 2.5
92,300 Petro-Canada 1,016,743 1,090,294 1.4
28,300 Phillips Petroleum Company 1,271,149 1,093,087 1.4
38,300 Texaco Inc. 2,177,183 1,814,463 2.4
23,900 Total, S.A. (Class B) 1,460,458 2,427,394 3.2
35,400 YPF Sociedad Anonima (ADR) (a) 867,831 1,128,375 1.5
------------ ------------ ----
17,112,816 20,657,943 27.1
- -------------------------------------------------------------------------------------------------------------------------------
Metals & Mining 1,803,712 + Centaur Mining and Exploration Limited 2,469,435 430,438 0.6
172,200 + Industrias Penoles, S.A. de C.V. 757,856 525,931 0.7
939,009 M.I.M. Holdings Limited 2,089,671 400,994 0.5
237,457 Minsur S.A. 597,621 356,998 0.5
196,000 Mitsubishi Materials Corporation 973,251 342,174 0.4
105,700 Noranda, Inc. 1,391,185 1,141,000 1.5
79,300 Outokumpu OYJ 1,460,162 737,915 1.0
7,300 Phelps Dodge Corporation 425,781 317,094 0.4
450 + Stillwater Mining Company 10,105 11,813 0.0
110,000 Sumitomo Metal Mining Co. 917,508 364,207 0.5
62,000 Trelleborg AB (Class B) 842,932 584,696 0.8
643,400 WMC Limited 3,807,237 1,975,830 2.6
119,840 + Zimbabwe Platinum Mines Limited 66,324 29,426 0.0
------------ ------------ ----
15,809,068 7,218,516 9.5
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
5
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
SCHEDULE OF INVESTMENTS (continued)
<TABLE>
<CAPTION>
Value Percent of
Industries Shares Held Common Stocks Cost (Note 1a) Net Assets
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Oil & Gas Producers 58,700 Alberta Energy Company Ltd. $ 1,276,545 $ 1,243,974 1.6%
31,500 Anadarko Petroleum Corporation 843,498 852,469 1.1
41,000 Apache Corporation 1,085,270 789,250 1.0
26,697 Burlington Resources Inc. 713,771 807,584 1.1
80,300 Cabot Oil & Gas Corporation (Class A) 1,246,175 1,053,937 1.4
187,550 + Canadian Hunter Exploration Ltd. 1,303,460 1,366,258 1.8
54,900 + Chieftain International, Inc. 1,232,560 679,387 0.9
36,500 Devon Energy Corporation 1,209,569 955,844 1.2
83,400 Enron Oil & Gas Company 1,712,551 1,438,650 1.9
180,900 + Gulf Canada Resources Limited (Ordinary) 1,424,587 463,556 0.6
16,000 IMC Global Inc. 292,000 291,000 0.4
78,000 + Northrock Resources Ltd. 639,975 557,881 0.7
75,400 + Oryx Energy Company 1,295,814 918,937 1.2
43,300 + Rio Alto Exploration Ltd. 414,518 401,457 0.5
70,400 Snyder Oil Corporation 1,405,091 800,800 1.0
42,700 Unocal Corporation 1,489,462 1,216,950 1.6
40,800 Vastar Resources, Inc. 1,720,948 1,568,250 2.1
------------ ------------ ----
19,305,794 15,406,184 20.1
- -------------------------------------------------------------------------------------------------------------------------------
Oil Services 25,400 Coflexip Stena Offshore Inc. 528,758 762,000 1.0
26,100 McDermott International, Inc. 912,733 539,944 0.7
31,900 + Noble Drilling Corporation 1,004,685 426,662 0.6
44,600 + Stolt Comex Seaway, S.A. 1,101,028 320,562 0.4
22,300 + Stolt Comex Seaway, S.A. (ADR) (a) 273,434 131,013 0.2
70,300 + TransCoastal Marine Services, Inc. 1,289,935 177,947 0.2
18,200 Transocean Offshore Inc. 585,579 465,238 0.6
46,900 USX-Marathon Group 1,395,976 1,066,975 1.4
32,925 + Weatherford International, Inc. 1,421,475 580,303 0.8
------------ ------------ ----
8,513,603 4,470,644 5.9
- -------------------------------------------------------------------------------------------------------------------------------
Paper & Pulp 45,666 Aracruz Celulose S.A. (ADR) (a) 365,755 650,741 0.8
23,900 Bowater Incorporated 1,094,682 933,594 1.2
23,000 Champion International Corporation 1,196,585 806,437 1.1
204,502 Nexfor Inc. 909,484 839,677 1.1
213,296 + Slocan Forest Products Ltd. 1,926,964 642,713 0.8
93,865 + Smurfit-Stone Container Corporation 1,180,672 1,507,707 2.0
------------ ------------ ----
6,674,142 5,380,869 7.0
- -------------------------------------------------------------------------------------------------------------------------------
Plantations 717,000 Golden Hope Plantations BHD 1,325,785 680,160 0.9
578,000 Kuala Lumpur Kepong BHD 790,865 913,836 1.2
------------ ------------ ----
2,116,650 1,593,996 2.1
- -------------------------------------------------------------------------------------------------------------------------------
Refining 38,400 Sunoco, Inc. 1,067,529 1,348,800 1.8
29,300 Ultramar Diamond Shamrock Corporation 698,163 644,600 0.8
------------ ------------ ----
1,765,692 1,993,400 2.6
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
SCHEDULE OF INVESTMENTS (concluded)
<TABLE>
<CAPTION>
Value Percent of
Industries Shares Held Common Stocks Cost (Note 1a) Net Assets
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Steel 12,400 Koninklijke Hoogovens N.V. (Class A) $ 545,807 $ 337,716 0.4%
341,000 Nippon Steel Corporation 1,163,723 604,111 0.8
------------- ------------ ------
1,709,530 941,827 1.2
- -------------------------------------------------------------------------------------------------------------------------------
Wood Products 146,100 + Riverside Forest Products Limited 2,401,223 1,064,305 1.4
- -------------------------------------------------------------------------------------------------------------------------------
Total Common Stocks 98,609,009 73,206,470 95.9
- -------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Face
Amount Short-Term Securities
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Repurchase $ 3,021,000 Warburg Dillion Read LLC, purchased on
Agreements* 1/29/1999 to yield 4.73% to 2/01/1999 3,021,000 3,021,000 4.0
- -------------------------------------------------------------------------------------------------------------------------------
US Government 1,000,000 US Treasury Bills, 4.15% due 2/04/1999 999,308 999,308 1.3
Obligations**
- -------------------------------------------------------------------------------------------------------------------------------
Total Short-Term Securities 4,020,308 4,020,308 5.3
- -------------------------------------------------------------------------------------------------------------------------------
Total Investments $ 102,629,317 77,226,778 101.2
=============
Liabilities in Excess of Other Assets (913,605) (1.2)
------------ ------
Net Assets $ 76,313,173 100.0%
============ ======
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(a) American Depositary Receipts (ADR).
(b) Global Depositary Receipts (GDR).
+ Non-income producing security.
* Repurchase Agreements are fully collateralized by US Government & Agency
Obligations.
** US Government Obligations are traded on a discount basis; the interest
rate shown reflects the discount rate paid at the time of purchase by the
Trust.
See Notes to Financial Statements.
7
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
FINANCIAL INFORMATION
Statement of Assets and Liabilities as of January 31, 1999
<TABLE>
<S> <C> <C> <C>
Assets: Investments, at value (identified cost--$102,629,317) (Note 1a) ............. $ 77,226,778
Cash ........................................................................ 655
Receivables:
Dividends ................................................................ $ 120,632
Securities sold .......................................................... 117,851
Beneficial interest sold ................................................. 31,376 269,859
---------
Prepaid registration fees and other assets (Note 1g) ........................ 35,640
------------
Total assets ................................................................ 77,532,932
------------
- --------------------------------------------------------------------------------------------------------------------------------
Liabilities: Payables:
Securities purchased ..................................................... 761,200
Beneficial interest redeemed ............................................. 236,080
Investment adviser (Note 2) .............................................. 38,787
Distributor (Note 2) ..................................................... 28,329 1,064,396
---------
Accrued expenses and other liabilities ...................................... 155,363
------------
Total liabilities ........................................................... 1,219,759
------------
- --------------------------------------------------------------------------------------------------------------------------------
Net Assets: Net assets .................................................................. $ 76,313,173
============
- --------------------------------------------------------------------------------------------------------------------------------
Net Assets Class A Shares of beneficial interest, $0.10 par value, unlimited number
Consist of: of shares authorized ........................................................ $ 62,136
Class B Shares of beneficial interest, $0.10 par value, unlimited number
of shares authorized ........................................................ 168,693
Class C Shares of beneficial interest, $0.10 par value, unlimited number
of shares authorized ........................................................ 11,866
Class D Shares of beneficial interest, $0.10 par value, unlimited number
of shares authorized ........................................................ 412,023
Paid-in capital in excess of par ............................................ 113,354,701
Accumulated investment loss--net ............................................ (214,235)
Accumulated realized capital losses on investments and foreign
currency transactions--net .................................................. (5,146,688)
Accumulated distributions in excess of realized capital gains on
investments and foreign currency transactions--net (Note 1h) ................ (6,933,579)
Unrealized depreciation on investments and foreigncurrency
transactions--net ........................................................... (25,401,744)
------------
Net assets .................................................................. $ 76,313,173
============
- --------------------------------------------------------------------------------------------------------------------------------
Net Asset Value: Class A--Based on net assets of $7,224,350 and 621,361 shares
of beneficial interest outstanding ................................. $ 11.63
============
Class B--Based on net assets of $19,766,916 and 1,686,932 shares
of beneficial interest outstanding ................................. $ 11.72
============
Class C--Based on net assets of $1,372,950 and 118,657 shares
of beneficial interest outstanding ................................. $ 11.57
============
Class D--Based on net assets of $47,948,957 and 4,120,228 shares
of beneficial interest outstanding ................................. $ 11.64
============
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
8
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
FINANCIAL INFORMATION (continued)
Statement of Operations for the Six Months Ended January 31, 1999
<TABLE>
<S> <C> <C> <C>
Investment Dividends (net of $56,745 foreign withholding tax) .................... $ 702,389
Income Interest and discount earned .......................................... 192,233
(Notes 1e & 1f): ------------
Total income .......................................................... 894,622
------------
- -----------------------------------------------------------------------------------------------------------------------------
Expenses: Investment advisory fees (Note 2) ..................................... $ 261,128
Account maintenance & distribution fees-Class B (Note 2) .............. 121,250
Transfer agent fees-Class D (Note 2) .................................. 85,744
Account maintenance fees-Class D (Note 2) ............................. 66,739
Transfer agent fees-Class B (Note 2) .................................. 46,082
Printing and shareholder reports ...................................... 38,521
Professional fees ..................................................... 34,973
Registration fees (Note 1g) ........................................... 29,186
Custodian fees ........................................................ 28,603
Trustees' fees and expenses ........................................... 27,495
Accounting services (Note 2) .......................................... 16,958
Transfer agent fees-Class A (Note 2) .................................. 12,860
Account maintenance and distribution fees-Class C (Note 2) ............ 6,966
Transfer agent fees-Class C (Note 2) .................................. 2,675
Pricing fees .......................................................... 1,961
Other ................................................................. 3,646
----------
Total expenses ........................................................ 784,787
------------
Investment income--net ................................................ 109,835
------------
- -----------------------------------------------------------------------------------------------------------------------------
Realized & Realized loss from:
Unrealized Gain Investments--net ................................................... (5,122,685)
(Loss) on Foreign currency transactions--net ................................. (24,003) (5,146,688)
Investments & ----------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net ................................................... (2,698,316)
(Notes 1c, 1d, Foreign currency transactions--net ................................. 6,021 (2,692,295)
1f & 3): ---------- ------------
Net realized and unrealized loss on investments and
foreign currency transactions ......................................... (7,838,983)
------------
Net Decrease in Net Assets Resulting from Operations .................. $ (7,729,148)
============
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
9
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
FINANCIAL INFORMATION (continued)
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
For the Six For the
Months Ended Year Ended
January 31, July 31,
Increase (Decrease) in Net Assets: 1999 1998
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Operations: Investment income--net .................................................... $ 109,835 $ 411,274
Realized loss on investments and foreign currency transactions--net ....... (5,146,688) (2,848,041)
Change in unrealized appreciation/depreciation on investments
and foreign currency transactions--net .................................... (2,692,295) (44,029,029)
------------ -------------
Net decrease in net assets resulting from operations ...................... (7,729,148) (46,465,796)
------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends & Investment income--net:
Distributions to Class A ................................................................ (123,766) (89,265)
Shareholders Class D ................................................................ (562,258) (239,469)
(Note 1h): Realized gain on investments--net:
Class A ................................................................ -- (1,233,600)
Class B ................................................................ -- (5,053,865)
Class C ................................................................ -- (178,070)
Class D ................................................................ -- (7,236,347)
In excess of realized gain on investments--net:
Class A ................................................................ (51,962) (591,336)
Class B ................................................................ -- (2,422,613)
Class C ................................................................ (4,683) (85,359)
Class D ................................................................ (348,806) (3,468,803)
------------ -------------
Net decrease in net assets resulting from dividends and
distributions to shareholders ............................................. (1,091,475) (20,598,727)
------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
Beneficial Interest Net decrease in net assets derived from beneficial
Transactions interest transactions ..................................................... (15,422,886) (38,351,521)
(Note 4): ------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets: Total decrease in net assets .............................................. (24,243,509) (105,416,044)
Beginning of period ....................................................... 100,556,682 205,972,726
------------ -------------
End of period* ............................................................ $ 76,313,173 $ 100,556,682
============ =============
- ------------------------------------------------------------------------------------------------------------------------------------
* Undistributed (accumulated) investment income (loss)--net ................. $ (214,235) $ 361,954
============ =============
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
10
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
FINANCIAL INFORMATION (continued)
Financial Highlights
<TABLE>
<CAPTION>
Class A
----------------------------------------------------------
For the
The following per share data and ratios have been derived Six Months
from information provided in the financial statements. Ended For the Year Ended July 31,
January 31, --------------------------------------------
Increase (Decrease) in Net Asset Value: 1999+ 1998+ 1997+ 1996+ 1995
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period ....... $ 12.93 $ 19.90 $ 17.27 $ 16.70 $ 15.84
Operating ------- ------- ------- ------- -------
Performance: Investment income--net ..................... .04 .13 .14 .22 .22
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net .......................... (1.08) (5.00) 2.91 .50 .88
------- ------- ------- ------- -------
Total from investment operations ........... (1.04) (4.87) 3.05 .72 1.10
------- ------- ------- ------- -------
Less dividends and distributions:
Investment income--net .................. (.18) (.10) (.23) (.15) (.24)
Realized gain on investments--net ....... (.08) (1.35) (.19) -- --
In excess of realized gain on
investments--net ........................ -- (.65) -- -- --
------- ------- ------- ------- -------
Total dividends and distributions .......... (.26) (2.10) (.42) (.15) (.24)
------- ------- ------- ------- -------
Net asset value, end of period ............. $ 11.63 $ 12.93 $ 19.90 $ 17.27 $ 16.70
======= ======= ======= ======= =======
- ---------------------------------------------------------------------------------------------------------------------------
Total Investment Based on net asset value per share ......... (7.90%)++ (27.00%) 17.95% 4.34% 7.05%
Return:** ======= ======= ======= ======= =======
- ---------------------------------------------------------------------------------------------------------------------------
Ratios to Average Expenses ................................... 1.34%* 1.07% 1.01% 1.03% 1.06%
Net Assets: ======= ======= ======= ======= =======
Investment income--net ..................... .71%* .79% .76% 1.26% 1.34%
======= ======= ======= ======= =======
- ---------------------------------------------------------------------------------------------------------------------------
Supplemental Net assets, end of period (in thousands) ... $ 7,224 $ 9,082 $ 18,504 $ 22,726 $ 28,729
Data: ======= ======= ======= ======= =======
Portfolio turnover ......................... 19.45% 21.04% 24.23% 26.48% 31.64%
======= ======= ======= ======= =======
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Annualized.
** Total investment returns exclude the effects of sales loads.
+ Based on average shares outstanding.
++ Aggregate total investment return.
See Notes to Financial Statements.
11
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
FINANCIAL INFORMATION (continued)
Financial Highlights (continued)
<TABLE>
<CAPTION>
Class B
----------------------------------------------------------------
For the
The following per share data and ratios have been derived Six Months
from information provided in the financial statements. Ended For the Year Ended July 31,
January 31, -------------------------------------------------
Increase (Decrease) in Net Asset Value: 1999++ 1998++ 1997++ 1996++ 1995
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period ..... $ 12.79 $ 19.80 $ 17.16 $ 16.62 $ 15.72
Operating -------- -------- -------- -------- --------
Performance: Investment income (loss)--net ............ (.02) (.05) (.05) .03 .10
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net ........................ (1.05) (4.96) 2.90 .51 .84
-------- -------- -------- -------- --------
Total from investment operations ......... (1.07) (5.01) 2.85 .54 .94
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net ................ -- -- (.02) --+ (.04)
Realized gain on investments--net ..... -- (1.35) (.19) -- --
In excess of realized gain on
investments--net ...................... -- (.65) -- -- --
-------- -------- -------- -------- --------
Total dividends and distributions ........ -- (2.00) (.21) -- (.04)
-------- -------- -------- -------- --------
Net asset value, end of period ........... $ 11.72 $ 12.79 $ 19.80 $ 17.16 $ 16.62
======== ======== ======== ======== ========
- ---------------------------------------------------------------------------------------------------------------------------------
Total Investment Based on net asset value per share ....... (8.37%)+++ (27.76%) 16.72% 3.26% 5.95%
Return:** ======== ======== ======== ======== ========
- ---------------------------------------------------------------------------------------------------------------------------------
Ratios to Average Expenses ................................. 2.40%* 2.11% 2.04% 2.07% 2.08%
Net Assets: ======== ======== ======== ======== ========
Investment income (loss)--net ............ (.31%)* (.29%) (.29%) .20% .31%
======== ======== ======== ======== ========
- ---------------------------------------------------------------------------------------------------------------------------------
Supplemental Net assets, end of period (in thousands).. $ 19,767 $ 29,794 $ 77,386 $ 94,199 $141,800
Data: ======== ======== ======== ======== ========
Portfolio turnover ....................... 19.45% 21.04% 24.23% 26.48% 31.64%
======== ======== ======== ======== ========
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Annualized.
** Total investment returns exclude the effects of sales loads.
+ Amount is less than $.01 per share.
++ Based on average shares outstanding.
+++ Aggregate total investment return.
See Notes to Financial Statements.
12
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
FINANCIAL INFORMATION (continued)
Financial Highlights (continued)
<TABLE>
<CAPTION>
Class C
--------------------------------------------------------------
For the
The following per share data and ratios have been derived For the Period
from information provided in the financial statements. Six Months Oct. 21,
Ended For the Year Ended July 31, 1994+ to
January 31, ------------------------------------ July 31,
Increase (Decrease) in Net Asset Value: 1999++ 1998++ 1997++ 1996++ 1995
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period ...... $ 12.67 $ 19.64 $ 17.08 $ 16.55 $ 15.93
Operating --------- --------- --------- --------- ---------
Performance: Investment income (loss)--net ............. (.02) (.04) (.06) .04 .05
Realized and unrealized gain (loss)
on investments and foreign currency
transactions--net ......................... (1.04) (4.93) 2.90 .49 .62
--------- --------- --------- --------- ---------
Total from investment operations .......... (1.06) (4.97) 2.84 .53 .67
--------- --------- --------- --------- ---------
Less dividends and distributions:
Investment income--net ................. -- -- (.09) -- (.05)
Realized gain on investments--net ...... (.04) (1.35) (.19) -- --
In excess of realized gain on
investments--net ....................... -- (.65) -- -- --
--------- --------- --------- --------- ---------
Total dividends and distributions ......... (.04) (2.00) (.28) -- (.05)
--------- --------- --------- --------- ---------
Net asset value, end of period ............ $ 11.57 $ 12.67 $ 19.64 $ 17.08 $ 16.55
========= ========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
Total Investment Based on net asset value per share ........ (8.34%)+++ (27.78%) 16.77% 3.20% 4.26%+++
Return:** ========= ========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
Ratios to Average Expenses .................................. 2.40%* 2.12% 2.06% 2.07% 2.20%*
Net Assets: ========= ========= ========= ========= =========
Investment income (loss)--net ............ (.40%)* (.29%) (.33%) .27% .28%*
========= ========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
Supplemental Net assets, end of period (in thousands) .. $ 1,373 $ 1,461 $ 2,680 $ 3,388 $ 2,800
Data: ========= ========= ========= ========= =========
Portfolio turnover ........................ 19.45% 21.04% 24.23% 26.48% 31.64%
========= ========= ========= ========= =========
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Annualized.
** Total investment returns exclude the effects of sales loads.
+ Commencement of operations.
++ Based on average shares outstanding.
+++ Aggregate total investment return.
See Notes to Financial Statements.
13
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
FINANCIAL INFORMATION (concluded)
Financial Highlights (concluded)
<TABLE>
<CAPTION>
Class D
--------------------------------------------------------------
For the
The following per share data and ratios have been derived For the Period
from information provided in the financial statements. Six Months Oct. 21,
Ended For the Year Ended July 31, 1994+ to
January 31, ------------------------------------ July 31,
Increase (Decrease) in Net Asset Value: 1999++ 1998++ 1997++ 1996++ 1995
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period ..... $ 12.89 $ 19.83 $ 17.21 $ 16.67 $ 15.96
Operating -------- -------- -------- -------- --------
Performance: Investment income--net ................... .03 .09 .09 .17 .12
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net ........................ (1.07) (4.99) 2.91 .50 .66
-------- -------- -------- -------- --------
Total from investment operations ......... (1.04) (4.90) 3.00 .67 .78
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net ................ (.13) (.04) (.19) (.13) (.07)
Realized gain on investments--net ..... (.08) (1.35) (.19) -- --
In excess of realized gain on
investments--net ...................... -- (.65) -- -- --
-------- -------- -------- -------- --------
Total dividends and distributions ........ (.21) (2.04) (.38) (.13) (.07)
-------- -------- -------- -------- --------
Net asset value, end of period ........... $ 11.64 $ 12.89 $ 19.83 $ 17.21 $ 16.67
======== ======== ======== ======== ========
- --------------------------------------------------------------------------------------------------------------------------------
Total Investment Based on net asset value per share ....... (8.02%)+++ (27.15%) 17.66% 4.06% 4.93%+++
Return:** ======== ======== ======== ======== ========
- --------------------------------------------------------------------------------------------------------------------------------
Ratios to Average Expenses ................................. 1.59%* 1.32% 1.26% 1.27% 1.39%*
Net Assets: ======== ======== ======== ======== ========
Investment income--net ................... .46%* .55% .51% 1.00% 1.02%*
======== ======== ======== ======== ========
- --------------------------------------------------------------------------------------------------------------------------------
Supplemental Net assets, end of period (in thousands).. $ 47,949 $ 60,220 $107,403 $108,924 $107,467
Data: ======== ======== ======== ======== ========
Portfolio turnover ....................... 19.45% 21.04% 24.23% 26.48% 31.64%
======== ======== ======== ======== ========
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Annualized.
** Total investment returns exclude the effects of sales loads.
+ Commencement of operations.
++ Based on average shares outstanding.
+++ Aggregate total investment return.
See Notes to Financial Statements.
14
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch Global Resources Trust (the "Trust") is registered under the
Investment Company Act of 1940 as a non-diversified, open-end management
investment company. The Fund's financial statements are prepared in accordance
with generally accepted accounting principles which may require the use of
management accruals and estimates. These unaudited financial statements reflect
all adjustments which are, in the opinion of management, necessary to a fair
statement of the results for the interim period presented. All such adjustments
are of a normal recurring nature. The Trust offers four classes of shares under
the Merrill Lynch Select Pricing(SM) System. Shares of Class A and Class D are
sold with a front-end sales charge. Shares of Class B and Class C may be subject
to a contingent deferred sales charge. All classes of shares have identical
voting, dividend, liquidation and other rights and the same terms and
conditions, except that Class B, Class C and Class D Shares bear certain
expenses related to the account maintenance of such shares, and Class B and
Class C Shares also bear certain expenses related to the distribution of such
shares. Each class has exclusive voting rights with respect to matters relating
to its account maintenance and distribution expenditures. The following is a
summary of significant accounting policies followed by the Trust.
(a) Valuation of investments -- Portfolio securities which are traded on stock
exchanges are valued at the last sale price on the exchange on which such
securities are traded, as of the close of business on the day the securities are
being valued or, lacking any sales, at the last available bid price. Securities
traded in the over-the-counter market are valued at the last available bid price
prior to the time of valuation. In cases where securities are traded on more
than one exchange, the securities are valued on the exchange designated by or
under the authority of the Trustees of the Trust as the primary market.
Securities which are traded both in the over-the-counter market and on a stock
exchange are valued according to the broadest and most representative market.
Options written or purchased are valued at the last sale price in the case of
exchange-traded options. In the case of options traded in the over-the-counter
market, valuation is the last asked price (options written) or the last bid
price (options purchased). Short-term securities are valued at amortized cost,
which approximates market value. Other investments are stated at market value.
Securities and other assets for which market value quotations are not available
are valued at their fair value as determined in good faith by or under the
direction of the Trustees of the Trust.
(b) Repurchase agreements -- The Trust invests in US Government securities
pursuant to repurchase agreements. Under such agreements, the counterparty
agrees to repurchase the security at a mutually agreed upon time and price. The
Trust takes possession of the underlying securities, marks to market such
securities and, if necessary, receives additional securities daily to ensure
that the contract is fully collateralized.
(c) Derivative financial instruments -- The Trust may engage in various
portfolio strategies to seek to increase its return by hedging its portfolio
against adverse movements in the equity, debt and currency markets. Losses may
arise due to changes in the value of the contract or if the counterparty does
not perform under the contract.
o Forward foreign exchange contracts -- The Trust is authorized to enter into
forward foreign exchange contracts as a hedge against either specific
transactions or portfolio positions. Such contracts are not entered on the
Trust's records. However, the effect on net investment income is recorded from
the date the Trust enters into such contracts.
o Options -- The Trust can write covered call options and purchase put options.
When the Trust writes an option, an amount equal to the premium received by the
Trust is reflected as an asset and an equivalent liability. The amount of the
liability is subsequently marked to market to reflect the current market value
of the option written. When a security is purchased or sold through an exercise
of an option, the related premium paid (or received) is added to (or deducted
from) the basis of the security acquired or deducted from (or added to) the
proceeds of the security sold. When an option expires (or the Trust enters into
a closing transaction), the Trust realizes a gain or loss on the option to the
extent of the premiums received or paid (or gain or loss to the extent the cost
of the closing transaction is less than or greater than the premiums paid or
received).
Written and purchased options are non-income producing investments.
(d) Foreign currency transactions -- Transactions denominated in foreign
currencies are recorded at
15
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
NOTES TO FINANCIAL STATEMENTS (continued)
the exchange rate prevailing when recognized. Assets and liabilities denominated
in foreign currencies are valued at the exchange rate at the end of the period.
Foreign currency transactions are the result of settling (realized) or valuing
(unrealized) assets or liabilities expressed in foreign currencies into US
dollars. Realized and unrealized gains or losses from investments include the
effects of foreign exchange rates on investments.
(e) Income taxes -- It is the Trust's policy to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and o t
distribute substantially all of its taxable income to its shareholders.
Therefore, no Federal income tax provision is required. Under the applicable
foreign tax law, a withholding tax may be imposed on interest, dividends and
capital gains at various rates.
(f) Security transactions and investment income --Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Dividend income is recorded on the ex-dividend dates. Dividends from foreign
securities where the ex-dividend date may have passed are subsequently recorded
when the Trust has determined the ex-dividend dates. Interest income is
recognized on the accrual basis. Realized gains and losses on security
transactions are determined on the identified cost basis.
(g) Prepaid registration fees -- Prepaid registration fees are charged to
expense as the related shares are issued.
(h) Dividends and distributions -- Dividends and distributions paid by the Trust
are recorded on the ex-dividend dates. Distributions in excess of realized
capital gains are due primarily to deferring tax treatments for post-October
losses.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Trust has entered into an Investment Advisory Agreement with Merrill Lynch
Asset Management, L.P. ("MLAM"). The general partner of MLAM is Princeton
Services, Inc. ("PSI"), an indirect wholly-owned subsidiary of Merrill Lynch &
Co., Inc. ("ML & Co."), which is the limited partner. The Trust has also entered
into a Distribution Agreement and Distribution Plans with Merrill Lynch Funds
Distributor ("MLFD" or "Distributor"), a division of Princeton Funds
Distributor, Inc. ("PFD"), which is a wholly-owned subsidiary of Merrill Lynch
Group, Inc.
MLAM is responsible for the management of the Trust's portfolio and provides the
necessary personnel, facilities, equipment and certain other services necessary
to the operations of the Trust. For such services, the Trust pays a monthly fee
of 0.60%, on an annual basis, of the average daily value of the Trust's net
assets.
Pursuant to the Distribution Plans adopted by the Trust in accordance with Rule
12b-1 under the Investment Company Act of 1940, the Trust pays the Distributor
ongoing account maintenance and distribution fees. The fees are accrued daily
and paid monthly at annual rates based upon the average daily net assets of the
shares as follows:
- --------------------------------------------------------------------------------
Account Distribution
Maintenance Fee Fee
- --------------------------------------------------------------------------------
Class B ................................. 0.25% 0.75%
Class C ................................. 0.25% 0.75%
Class D ................................. 0.25% --
- --------------------------------------------------------------------------------
Pursuant to a sub-agreement with the Distributor, Merrill Lynch, Pierce, Fenner
& Smith Incorporated ("MLPF&S"), a subsidiary of ML & Co., also provides account
maintenance and distribution services to the Trust. The ongoing account
maintenance fee compensates the Distributor and MLPF&S for providing account
maintenance services to Class B, Class C and Class D shareholders. The ongoing
distribution fee compensates the Distributor and MLPF&S for providing
shareholder and distribution-related services to Class B and Class C
shareholders.
For the six months ended January 31, 1999, MLFD earned underwriting discounts
and MLPF&S earned dealer concessions on sales of the Trust's Class A and Class D
Shares as follows:
- --------------------------------------------------------------------------------
MLFD MLPF&S
- --------------------------------------------------------------------------------
Class A ................................. $ 103 $1,212
Class D ................................. $ 37 $ 652
- --------------------------------------------------------------------------------
For the six months ended January 31, 1999, MLPF&S received contingent deferred
sales charges of $24,088 and $438 relating to transactions in Class B and C
Shares, respectively.
In addition, MLPF&S received $8,850 in commissions on the execution of portfolio
security transactions for the Trust for the six months ended January 31, 1999.
Financial Data Services, Inc. ("FDS"), a wholly-owned subsidiary of
ML & Co., is the Trust's transfer agent.
16
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
Accounting services are provided to the Trust by MLAM at cost.
Certain officers and/or trustees of the Trust are officers and/or directors of
MLAM, PSI, FDS, PFD, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for the six
months ended January 31, 1999 were $15,325,423 and $28,785,229, respectively.
Net realized losses for the six months ended January 31, 1999 and net unrealized
gains (losses) as of January 31, 1999 were as follows:
- --------------------------------------------------------------------------------
Realized Unrealized
Losses Gains (Losses)
- --------------------------------------------------------------------------------
Long-term investments .................... $(5,122,089) $(25,402,539)
Short-term investments ................... (596) --
Foreign currency transactions ............ (24,003) 795
----------- ------------
Total .................................... $(5,146,688) $(25,401,744)
=========== ============
- --------------------------------------------------------------------------------
As of January 31, 1999, net unrealized depreciation for Federal income tax
purposes aggregated $25,402,539, of which $6,821,563 related to appreciated
securities and $32,224,102 related to depreciated securities. At January 31,
1999, the aggregate cost of investments for Federal income tax purposes was
$102,629,317.
4. Beneficial Interest Transactions:
Net decrease in net assets derived from beneficial interest transactions was
$15,422,886 and $38,351,521 for the six months ended January 31, 1999 and for
the year ended July 31, 1998, respectively.
Transactions in shares of beneficial interest for each class were as follows:
- --------------------------------------------------------------------------------
Class A Shares for the Six Months Dollar
Ended January 31, 1999 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .................................... 109,929 $ 1,328,008
Shares issued to shareholders
in reinvestment of dividends
and distributions .............................. 14,279 155,903
---------- ------------
Total issued ................................... 124,208 1,483,911
Shares redeemed ................................ (205,322) (2,466,478)
---------- ------------
Net decrease ................................... (81,114) $ (982,567)
========== ============
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class A Shares for the Year Dollar
Ended July 31, 1998 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .................................... 251,435 $ 3,890,541
Shares issued to shareholders
in reinvestment of dividends
and distributions .............................. 98,253 1,700,980
---------- ------------
Total issued ................................... 349,688 5,591,521
Shares redeemed ................................ (577,238) (9,070,150)
---------- ------------
Net decrease ................................... (227,550) $ (3,478,629)
========== ============
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class B Shares for the Six Months Dollar
Ended January 31, 1999 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .................................... 91,370 $ 1,107,927
Automatic conversion of shares ................. (63,582) (765,170)
Shares redeemed ................................ (670,230) (8,063,596)
---------- ------------
Net decrease ................................... (642,442) $ (7,720,839)
========== ============
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class B Shares for the Year Dollar
Ended July 31, 1998 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .................................... 372,051 $ 6,141,470
Shares issued to shareholders
in reinvestment of distributions ............... 352,334 6,075,936
---------- ------------
Total issued ................................... 724,385 12,217,406
Automatic conversion of shares ................. (174,357) (2,685,847)
Shares redeemed ................................ (2,129,327) (33,391,721)
---------- ------------
Net decrease ................................... (1,579,299) $(23,860,162)
========== ============
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class C Shares for the Six Months Dollar
Ended January 31, 1999 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .................................... 27,001 $ 318,848
Shares issued to shareholders
in reinvestment of distributions ............... 380 4,096
---------- ------------
Total issued ................................... 27,381 322,944
Shares redeemed ................................ (24,026) (292,976)
---------- ------------
Net increase ................................... 3,355 $ 29,968
========== ============
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class C Shares for the Year Dollar
Ended July 31, 1998 Shares Amount
- --------------------------------------------------------------------------------
Shares sold .................................... 292,397 $ 4,497,842
Shares issued to shareholders
in reinvestment of distributions ............... 13,740 233,761
---------- ------------
Total issued ................................... 306,137 4,731,603
Shares redeemed ................................ (327,342) (5,047,786)
---------- ------------
Net decrease ................................... (21,205) $ (316,183)
========== ============
- --------------------------------------------------------------------------------
17
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
NOTES TO FINANCIAL STATEMENTS (concluded)
- --------------------------------------------------------------------------------
Class D Shares for the Six Months Dollar
Ended January 31, 1999 Shares Amount
- --------------------------------------------------------------------------------
Shares sold ............................ 50,556 $ 608,857
Automatic conversion
of shares .............................. 63,561 765,170
Shares issued to shareholders
in reinvestment of dividends
and distributions ...................... 61,096 666,540
--------- ------------
Total issued ........................... 175,213 2,040,567
Shares redeemed ........................ (727,966) (8,790,015)
--------- ------------
Net decrease ........................... (552,753) $ (6,749,448)
========= ============
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Class D Shares for the Year Dollar
Ended July 31, 1998 Shares Amount
- --------------------------------------------------------------------------------
Shares sold ............................ 688,374 $ 12,306,366
Automatic conversion
of shares .............................. 173,783 2,685,847
Shares issued to shareholders
in reinvestment of dividends
and distributions ...................... 465,362 8,004,915
--------- ------------
Total issued ........................... 1,327,519 22,997,128
Shares redeemed ........................ (2,069,885) (33,693,675)
--------- ------------
Net decrease ........................... (742,366) $(10,696,547)
========= ============
- --------------------------------------------------------------------------------
5. Commitments:
On January 31, 1999, the Trust had entered into foreign exchange contracts,
under which it had agreed to buy foreign currency with the approximate value of
$328,000.
OFFICERS AND TRUSTEES
Arthur Zeikel, President and Trustee
Donald Cecil, Trustee
M. Colyer Crum, Trustee
Edward H. Meyer, Trustee
Jack B. Sunderland, Trustee
J. Thomas Touchton, Trustee
Fred G. Weiss, Trustee
Terry K. Glenn, Executive Vice President
Robert M. Shearer, Senior Vice President and Portfolio Manager
Donald C. Burke, Vice President and Treasurer
Thomas D. Jones, III, Secretary
Custodian
The Bank of New York
90 Washington Street, 12th Floor
New York, NY 10286
Transfer Agent
Financial Data Services, Inc.
4800 Deer Lake Drive
East Jacksonville, FL 32246-6484
(800) 637-3863
- --------------------------------------------------------------------------------
Gerald M. Richard, Treasurer and Norman R. Harvey, Senior Vice President
of Merrill Lynch Global Resources Trust have recently retired. Their
colleagues at Merrill Lynch Asset Management, L.P. join the Fund's Board
of Trustees in wishing Mr. Richard and Mr. Harvey well in their
retirements.
- --------------------------------------------------------------------------------
18
<PAGE>
Merrill Lynch Global Resources Trust January 31, 1999
PORTFOLIO INFORMATION
As of January 31, 1999
Percent of
Ten Largest Equity Holdings .................................. Net Assets
ENI (ADR) .................................................... 3.4%
Total S.A. (Class B) ......................................... 3.2
Placer Dome Inc. ............................................. 3.1
Elf Aquitaine S.A. (ADR) ..................................... 3.1
Chevron Corporation .......................................... 3.0
WMC Limited .................................................. 2.6
Mobil Corporation ............................................ 2.5
Texaco Inc. .................................................. 2.4
Vastar Resources, Inc. ....................................... 2.1
BP Amoco PLC (ADR) ........................................... 2.0
Percent of
Geographic Allocation Net Assets
United States ................................................ 42.2%
Canada ....................................................... 16.6
Australia .................................................... 8.5
France ....................................................... 8.2
United Kingdom ............................................... 5.0
Italy ........................................................ 3.4
Japan ........................................................ 2.5
Malaysia ..................................................... 2.1
Argentina .................................................... 1.5
Ghana ........................................................ 1.1
Finland ...................................................... 1.0
Brazil ....................................................... 0.8
Sweden ....................................................... 0.8
Mexico ....................................................... 0.7
Norway ....................................................... 0.6
Peru ......................................................... 0.5
Netherlands .................................................. 0.4
Equity Portfolio Changes for the Quarter Ended January 31, 1999
Additions
Anadarko Petroleum Corporation
BP Amoco PLC (ADR)
Canadian Hunter Exploration Ltd.
Exxon Corporation
IMC Global Inc.
Rio Alto Exploration Ltd.
Stillwater Mining Company
USX-Marathon Group
Deletions
EEX Corporation
Getchell Gold Corp.
Great Central Mines Limited
North Limited
Renaissance Energy Ltd.
Savage Resources Limited
Valero Energy Corporation
19
<PAGE>
This report is not authorized for use as an offer of sale or a solicitation of
an offer to buy shares of the Trust unless accompanied or preceded by the
Trust's current prospectus. Past performance results shown in this report should
not be considered a representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when redeemed, may be
worth more or less than their original cost. Statements and other information
herein are as dated and are subject to change.
Merrill Lynch
Global Resources Trust
Box 9011 Princeton, NJ
08543-9011 #10303 -- 1/99
[RECYCLE LOGO] Printed on post-consumer recycled paper
