<PAGE>
- ------------------------------------------------------
Semiannual Report - Financial Statements
- ------------------------------------------------------
T. ROWE PRICE
Equity
Index 500
Fund
-----------------
June 30, 1998
-----------------
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Unaudited
<TABLE>
<CAPTION>
- ----------------------
Financial Highlights For a share outstanding throughout each period
- ------------------------------------------------------------------------------------------------
6 Months Year
Ended Ended
6/30/98 12/31/97 12/31/96 12/31/95 12/31/94 12/31/93
<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE
Beginning of period $ 26.38 $ 20.34 $ 17.21 $ 13.09 $ 13.48 $ 12.63
Investment activities
Net investment income 0.16(S) 0.35** 0.38** 0.39* 0.36* 0.32*
Net realized and
unrealized gain (loss) 4.45 6.28 3.47 4.43 (0.23) 0.86
..................................................................
Total from
investment activities 4.61 6.63 3.85 4.82 0.13 1.18
Distributions
Net investment income (0.16) (0.34) (0.38) (0.40) (0.36) (0.32)
Net realized gain (0.02) (0.25) (0.34) (0.30) (0.09) (0.01)
Distributions in excess
of net realized gain -- -- -- -- (0.07) --
..................................................................
Total distributions (0.18) (0.59) (0.72) (0.70) (0.52) (0.33)
NET ASSET VALUE
End of period $ 30.81 $ 26.38 $ 20.34 $ 17.21 $ 13.09 $ 13.48
------------------------------------------------------------------
Ratios/Supplemental Data
Total return. 17.49%(S) 32.87%** 22.65%** 37.16%* 1.01%* 9.42%*
................................................................................................
Ratio of expenses to
average net assets 0.40%(S)+ 0.40%** 0.40%** 0.45%* 0.45%* 0.45%*
................................................................................................
Ratio of net investment
income to average
net assets 1.18%(S)+ 1.49%** 2.05%** 2.54%* 2.73%* 2.40%*
................................................................................................
Portfolio turnover rate 1.2% 0.7% 1.3% 1.3% 1.3% 0.8%
................................................................................................
Net assets, end of period
(in millions) $ 2,650 $ 1,908 $ 808 $ 457 $ 270 $ 167
................................................................................................
</TABLE>
. Total return reflects the rate that an investor would have earned on an
investment in the fund during each period, assuming reinvestment of all
distributions and payment of no redemption or account fees.
* Excludes expenses in excess of a 0.45% voluntary expense limitation in effect
through 12/31/95.
** Excludes expenses in excess of a 0.40% voluntary expense limitation in effect
through 12/31/97.
(S)Excludes expenses in excess of a 0.40% voluntary expense limitation in
effect through 12/31/99.
+ Annualized.
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Unaudited June 30, 1998
- ------------------------
Statement of Net Assets Shares/par Value
- --------------------------------------------------------------------------------
In thousands
Common Stocks 99.3%
BASIC MATERIALS 0.7%
Aluminum 0.3%
Alcoa 50,271 $ 3,315
................................................................................
Alcan Aluminum 65,784 1,817
................................................................................
Reynolds Metals 21,302 1,192
................................................................................
6,324
..............
Iron and Steel 0.1%
Nucor 25,084 1,154
................................................................................
USX-U.S. Steel 24,224 799
................................................................................
Bethlehem Steel * 41,488 516
................................................................................
Worthington Industries 27,107 407
................................................................................
Armco * 30,091 192
................................................................................
3,068
..............
Miscellaneous Mining, Metals 0.1%
Phelps Dodge 17,421 996
................................................................................
Inco 49,001 668
................................................................................
Cyprus Amax Minerals 27,247 361
................................................................................
ASARCO 11,501 256
................................................................................
2,281
..............
Precious Metals 0.2%
Barrick Gold 108,363 2,079
................................................................................
Newmont Mining 48,030 1,135
................................................................................
Placer Dome 71,683 842
................................................................................
Freeport McMoRan Copper & Gold (Class B) 55,363 841
................................................................................
Homestake Mining 59,932 622
................................................................................
Battle Mountain Gold 66,390 394
................................................................................
5,913
..............
Total Basic Materials 17,586
..............
BUSINESS SERVICES AND
TRANSPORTATION 2.5%
Advertising 0.2%
Omnicom 49,798 2,484
................................................................................
Interpublic Group 40,066 2,431
................................................................................
4,915
..............
3
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/par Value
- --------------------------------------------------------------------------------
In thousands
Air Transport 0.5%
AMR * 53,016 $ 4,414
................................................................................
Delta 22,003 2,844
................................................................................
FDX * 43,107 2,705
................................................................................
USAir * 29,682 2,352
................................................................................
Southwest Airlines 65,773 1,948
................................................................................
14,263
..............
Engineering Services 0.0%
EG&G 12,373 371
................................................................................
371
..............
Pollution Control 0.3%
Waste Management 132,808 4,648
................................................................................
Browning-Ferris 55,477 1,928
................................................................................
Laidlaw 98,858 1,205
................................................................................
7,781
..............
Railroads 0.5%
Burlington Northern Santa Fe 45,632 4,480
................................................................................
Norfolk Southern 109,838 3,275
................................................................................
Union Pacific 73,047 3,223
................................................................................
CSX 64,544 2,937
................................................................................
13,915
..............
Services 1.0%
Cendant * 250,676 5,233
................................................................................
Marsh & McLennan 75,733 4,577
................................................................................
Service Corp. International 75,206 3,224
................................................................................
Cognizant 47,520 2,994
................................................................................
Dun & Bradstreet * 51,753 1,870
................................................................................
Equifax 43,852 1,592
................................................................................
Dow Jones 27,670 1,543
................................................................................
H&R Block 31,310 1,319
................................................................................
Ceridian * 21,410 1,258
................................................................................
Deluxe Corp. 24,194 866
................................................................................
Ryder System 21,569 681
................................................................................
25,157
..............
Total Business Services and Transportation 66,402
..............
4
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
CAPITAL EQUIPMENT 6.4%
Industrial Manufacturing 5.5%
GE 956,536 $ 87,045
................................................................................
Tyco International 170,437 10,738
................................................................................
3M 119,636 9,833
................................................................................
AlliedSignal 163,471 7,254
................................................................................
United Technologies 67,567 6,250
................................................................................
Illinois Tool Works 73,527 4,903
................................................................................
Textron 47,546 3,408
................................................................................
Corning 66,606 2,315
................................................................................
Dover 65,076 2,229
................................................................................
TRW 35,722 1,951
................................................................................
Cooper Industries 35,447 1,947
................................................................................
Allegheny Teledyne 57,041 1,305
................................................................................
Parker Hannifin 32,380 1,234
................................................................................
Stanley Works 26,417 1,098
................................................................................
FMC * 11,017 751
................................................................................
Pall 34,637 710
................................................................................
National Service Industries 12,923 657
................................................................................
Cummins Engine 11,687 599
................................................................................
Timken 17,330 534
................................................................................
General Signal 14,145 509
................................................................................
Aeroquip-Vickers 8,714 509
................................................................................
Briggs & Stratton 8,241 309
................................................................................
Cincinnati Milacron 10,924 266
................................................................................
146,354
..............
Producers Goods 0.9%
Caterpillar 109,148 5,771
................................................................................
Deere 72,542 3,836
................................................................................
Ingersoll-Rand 47,721 2,103
................................................................................
Genuine Parts 51,402 1,777
................................................................................
Eaton 21,625 1,681
................................................................................
W. W. Grainger 28,152 1,402
................................................................................
Johnson Controls 23,869 1,365
................................................................................
ITT Industries 34,266 1,281
................................................................................
Case 21,218 1,024
................................................................................
Crane 13,700 665
................................................................................
McDermott International 18,396 633
................................................................................
5
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
Harnischfeger 13,037 $ 369
................................................................................
Foster Wheeler 10,311 221
................................................................................
22,128
..............
Total Capital Equipment 168,482
..............
CONSUMER CYCLICALS 2.5%
Construction 0.3%
Masco 48,034 2,906
................................................................................
Sherwin-Williams 52,519 1,740
................................................................................
Fluor 24,582 1,253
................................................................................
Armstrong World 11,845 798
................................................................................
Centex 17,110 646
................................................................................
Owens Corning 15,589 636
................................................................................
Kaufman & Broad 12,150 386
................................................................................
8,365
..............
Consumer Durables 0.2%
Black & Decker 27,754 1,693
................................................................................
Whirlpool 22,113 1,520
................................................................................
Maytag 27,139 1,340
................................................................................
4,553
..............
Motor Vehicles 1.9%
Ford Motor 354,232 20,900
................................................................................
GM 205,817 13,751
................................................................................
Chrysler 188,030 10,600
................................................................................
Dana 31,161 1,667
................................................................................
PACCAR 22,657 1,182
................................................................................
Echlin 17,823 875
................................................................................
Navistar * 19,943 576
................................................................................
Fleetwood 11,759 470
................................................................................
50,021
..............
Real Estate 0.0%
Pulte 10,906 326
................................................................................
326
..............
Tire & Rubber 0.1%
Goodyear Tire & Rubber 45,339 2,922
................................................................................
Cooper Tire 23,779 490
................................................................................
3,412
..............
Total Consumer Cyclicals 66,677
..............
6
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
CONSUMER NONDURABLES 11.7%
Agriculture, Food 2.4%
Unilever N.V. ADR 188,114 $ 14,849
................................................................................
Sara Lee 137,975 7,718
................................................................................
Campbell 133,009 7,066
................................................................................
Heinz 107,367 6,026
................................................................................
Bestfoods 84,174 4,887
................................................................................
Kellogg 119,445 4,487
................................................................................
ConAgra 139,291 4,414
................................................................................
Wrigley 33,768 3,309
................................................................................
Archer Daniels Midland 165,721 3,211
................................................................................
General Mills 46,258 3,163
................................................................................
Pioneer Hi-Bred 70,894 2,933
................................................................................
Hershey Foods 41,992 2,898
................................................................................
64,961
..............
Beverages 3.1%
Coca-Cola 723,045 61,821
................................................................................
PepsiCo 442,564 18,228
................................................................................
Quaker Oats 41,522 2,281
................................................................................
82,330
..............
Containers 0.3%
Owens-Illinois * 44,250 1,980
................................................................................
Tenneco 50,288 1,914
................................................................................
Crown Cork & Seal 37,562 1,784
................................................................................
Temple-Inland 16,640 896
................................................................................
Sealed Air * 24,264 892
................................................................................
Bemis 15,254 624
................................................................................
Ball 8,599 346
................................................................................
8,436
..............
Cosmetics 1.5%
Procter & Gamble 391,664 35,666
................................................................................
Avon 38,145 2,956
................................................................................
Alberto Culver (Class B) 16,213 470
................................................................................
39,092
..............
Leisure, Luxury 0.5%
Seagram 103,512 4,237
................................................................................
Mattel 86,979 3,680
................................................................................
Hilton 72,984 2,080
................................................................................
7
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
Hasbro 39,290 $ 1,545
................................................................................
Brunswick 27,631 684
................................................................................
12,226
.............
Liquor 0.4%
Anheuser-Busch 142,856 6,741
................................................................................
Fortune Brands 52,028 2,000
................................................................................
Brown-Forman (Class B) 20,282 1,303
................................................................................
Coors (Class B) 11,118 379
................................................................................
10,423
.............
Photographic, Optical 0.3%
Eastman Kodak 94,307 6,891
................................................................................
Polaroid 13,110 466
................................................................................
7,357
.............
Soaps, Houseware 1.8%
Gillette 330,704 18,747
................................................................................
Colgate-Palmolive 87,328 7,685
................................................................................
Kimberly-Clark 163,112 7,483
................................................................................
Ralston Purina 31,293 3,655
................................................................................
Clorox 29,378 2,802
................................................................................
Newell 46,961 2,339
................................................................................
Rubbermaid 43,751 1,452
................................................................................
International Flavors & Fragrances 32,207 1,399
................................................................................
Ecolab 38,097 1,181
................................................................................
Tupperware 19,273 542
................................................................................
NACCO Industries (Class A) 2,317 299
................................................................................
47,584
.............
Textiles and Apparel 0.3%
NIKE (Class B) 84,191 4,099
................................................................................
V. F. 35,235 1,815
................................................................................
Liz Claiborne 19,535 1,021
................................................................................
Fruit of the Loom (Class A) * 20,919 694
................................................................................
Reebok * 16,491 456
................................................................................
Springs Industries 6,739 311
................................................................................
Russell 9,644 291
................................................................................
8,687
.............
8
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
Tobacco 1.1%
Philip Morris 713,668 $ 28,101
................................................................................
UST 53,786 1,452
................................................................................
29,553
...........
Total Consumer Nondurables 310,649
...........
CONSUMER SERVICES 9.9%
Hotels, Restaurants 0.8%
McDonald's 201,233 13,885
................................................................................
Marriott (Class A) 74,900 2,425
................................................................................
Tricon Global Restaurants * 42,976 1,362
................................................................................
Mirage Resorts * 51,629 1,100
................................................................................
Wendys 39,160 920
................................................................................
Darden Restaurants 43,426 690
................................................................................
Harrah's Entertainment * 29,607 688
................................................................................
21,070
...........
Media 2.8%
Disney 199,395 20,949
................................................................................
Time Warner 173,418 14,816
................................................................................
MediaOne Group * 177,958 7,819
................................................................................
CBS 211,111 6,703
................................................................................
Viacom (Class B) * 104,707 6,099
................................................................................
Tele-Communications (Class A) * 149,457 5,740
................................................................................
Comcast (Class A Special) 107,780 4,375
................................................................................
Clear Channel Communications * 36,055 3,935
................................................................................
Tribune 35,311 2,430
................................................................................
King World Productions * 21,575 550
................................................................................
73,416
...........
Publishing 0.7%
Gannett 82,737 5,880
................................................................................
McGraw-Hill 29,087 2,372
................................................................................
New York Times (Class A) 28,521 2,260
................................................................................
R.R. Donnelley 43,011 1,968
................................................................................
Times Mirror (Class A) 25,798 1,622
................................................................................
Knight-Ridder 23,263 1,281
................................................................................
American Greetings (Class A) 21,910 1,116
................................................................................
9
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
Meredith 14,917 $ 700
................................................................................
Moore 27,475 364
................................................................................
Jostens 12,220 292
................................................................................
17,855
..........
Retail - Clothing 0.5%
The Gap 115,547 7,121
................................................................................
The Limited 77,028 2,551
................................................................................
TJX 93,336 2,252
................................................................................
Nordstrom 22,444 1,733
................................................................................
Venator Group * 38,070 728
................................................................................
14,385
..........
Retail - Computer/Electronics 0.1%
Tandy 29,260 1,553
................................................................................
Circuit City Stores 28,597 1,340
................................................................................
2,893
..........
Retail - Food 0.6%
Albertson's 71,569 3,708
................................................................................
Kroger * 74,854 3,209
................................................................................
Sysco 100,476 2,575
................................................................................
Winn-Dixie 43,057 2,204
................................................................................
American Stores 79,353 1,919
................................................................................
Giant Food (Class A) 18,536 798
................................................................................
Supervalu 17,061 757
................................................................................
A & P 11,962 396
................................................................................
15,566
..........
Retail - General Department 2.9%
Wal-Mart 658,361 39,995
................................................................................
Sears 114,661 7,002
................................................................................
Dayton Hudson 127,218 6,170
................................................................................
J.C. Penney 73,147 5,290
................................................................................
May Department Stores 67,090 4,394
................................................................................
Costco Companies * 62,702 3,956
................................................................................
Federated Department Stores * 61,857 3,329
................................................................................
Kmart * 143,388 2,760
................................................................................
Dillards (Class A) 32,778 1,358
................................................................................
Harcourt General 20,694 1,231
................................................................................
Consolidated Stores * 32,967 1,195
................................................................................
Mercantile Stores 11,132 879
................................................................................
77,559
..........
10
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
Retail - All Other 1.5%
Home Depot 216,039 $ 17,945
................................................................................
Walgreen 145,196 5,999
................................................................................
CVS 113,524 4,420
................................................................................
Lowes 101,824 4,130
................................................................................
Rite Aid 76,081 2,858
................................................................................
Toys "R" Us * 81,218 1,914
................................................................................
AutoZone * 44,552 1,423
................................................................................
Pep Boys 18,913 358
................................................................................
Longs Drug Stores 11,226 324
................................................................................
39,371
..........
Total Consumer Services 262,115
..........
ENERGY 7.9%
Domestic Petroleum Reserves 1.1%
Amoco 284,688 11,850
................................................................................
Atlantic Richfield 94,884 7,413
................................................................................
Phillips Petroleum 76,438 3,683
................................................................................
Burlington Resources 53,003 2,283
................................................................................
Union Pacific Resources 74,793 1,314
................................................................................
Anadarko Petroleum 17,977 1,208
................................................................................
Apache 28,141 886
................................................................................
Pennzoil 14,140 716
................................................................................
29,353
..........
Foreign Petroleum Reserves 0.0%
Kerr-McGee 13,619 788
................................................................................
788
..........
Gas Utilities 0.7%
Enron 96,882 5,238
................................................................................
Williams Companies 124,199 4,192
................................................................................
Sempra Energy * 69,791 1,937
................................................................................
Consolidated Natural Gas 28,540 1,680
................................................................................
Columbia Gas System 23,814 1,325
................................................................................
Sonat 32,179 1,243
................................................................................
NICOR 13,920 558
................................................................................
Peoples Energy 11,375 439
................................................................................
ONEOK 8,754 349
................................................................................
Eastern Enterprises 6,818 292
................................................................................
17,253
..........
11
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
International Oil 3.7%
Exxon 719,254 $ 51,292
................................................................................
Mobil 228,771 17,529
................................................................................
Chevron 191,144 15,877
................................................................................
Texaco 160,010 9,551
................................................................................
Unocal 70,758 2,530
................................................................................
Oryx Energy * 30,116 666
................................................................................
97,445
..........
Oil Refining, Distribution 1.6%
Royal Dutch Petroleum ADR 629,515 34,505
................................................................................
USX-Marathon 85,789 2,944
................................................................................
Coastal 31,452 2,196
................................................................................
Amerada Hess 27,337 1,485
................................................................................
Ashland 22,905 1,182
................................................................................
Sun Company 27,238 1,057
................................................................................
43,369
..........
Oil Service 0.8%
Schlumberger 146,929 10,037
................................................................................
Halliburton 76,886 3,426
................................................................................
Dresser Industries 52,577 2,317
................................................................................
Baker Hughes 49,001 1,694
................................................................................
Western Atlas 16,264 1,380
................................................................................
Rowan * 24,102 468
................................................................................
Helmerich & Payne 15,674 349
................................................................................
19,671
..........
Total Energy 207,879
..........
FINANCIAL 17.6%
Banks 8.5%
NationsBank 281,210 21,513
................................................................................
Citicorp 132,884 19,833
................................................................................
Chase Manhattan 250,256 18,894
................................................................................
BankAmerica 202,257 17,483
................................................................................
First Union 282,053 16,430
................................................................................
BANC ONE 204,540 11,416
................................................................................
Wells Fargo 25,480 9,402
................................................................................
U.S. Bancorp 216,033 9,289
................................................................................
Norwest 219,621 8,208
................................................................................
First Chicago NBD 85,126 7,544
................................................................................
12
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
SHARES/PAR VALUE
- --------------------------------------------------------------------------------
In thousands
Fleet Financial Group 82,806 $ 6,914
................................................................................
National City 95,216 6,760
................................................................................
Bank of New York 109,471 6,644
................................................................................
J. P. Morgan 51,378 6,018
................................................................................
Mellon Bank 76,451 5,323
................................................................................
Wachovia 60,533 5,115
................................................................................
SunTrust 61,607 5,009
................................................................................
BankBoston 85,552 4,759
................................................................................
PNC Bank 88,238 4,748
................................................................................
Fifth Third Bancorp 73,154 4,602
................................................................................
KeyCorp 128,630 4,583
................................................................................
Bankers Trust New York 28,668 3,327
................................................................................
State Street 46,444 3,228
................................................................................
Comerica 46,458 3,078
................................................................................
BB&T 41,234 2,789
................................................................................
Summit Bancorp 53,166 2,525
................................................................................
Northern Trust 32,686 2,491
................................................................................
Republic New York 32,366 2,037
................................................................................
Mercantile Bancorporation 39,900 2,010
................................................................................
Huntington Bancshares 54,686 1,835
................................................................................
Synovus Financial 75,015 1,782
................................................................................
225,589
..........
Life Insurance 1.0%
American General 72,973 5,195
................................................................................
Aetna 42,959 3,270
................................................................................
Sunamerica 56,853 3,266
................................................................................
Lincoln National 29,343 2,681
................................................................................
Conseco 54,418 2,544
................................................................................
Providian Financial 27,574 2,166
................................................................................
Transamerica 18,431 2,122
................................................................................
Torchmark 41,040 1,878
................................................................................
Jefferson Pilot 31,811 1,843
................................................................................
24,965
..........
Miscellaneous Finance 3.5%
Travelers Group 336,428 20,396
................................................................................
Morgan Stanley Dean Witter Discover 175,635 16,049
................................................................................
American Express 136,015 15,506
................................................................................
Merrill Lynch 100,833 9,302
................................................................................
Associates First Capital (Class A) 100,789 7,748
................................................................................
13
<PAGE>
T. Rowe Price Equity Index 500 Fund
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
MBNA 146,703 $ 4,841
................................................................................
Household International 93,806 4,667
................................................................................
Franklin Resources 73,500 3,969
................................................................................
Lehman Brothers 34,543 2,679
................................................................................
Charles Schwab 76,493 2,486
................................................................................
Beneficial 15,069 2,308
................................................................................
Bear Stearns 33,400 1,900
................................................................................
SLM Holding 24,500 1,200
................................................................................
Capital One Financial 3,100 385
................................................................................
93,436
..........
Mortgage Financing 1.2%
Fannie Mae 307,603 18,687
................................................................................
Freddie Mac 203,370 9,571
................................................................................
Green Tree Financial 39,752 1,702
................................................................................
Countrywide Credit 31,342 1,590
................................................................................
31,550
..........
Other Insurance 3.1%
American International Group 204,804 29,901
................................................................................
Allstate 124,795 11,427
................................................................................
General Re 23,011 5,833
................................................................................
CIGNA 64,396 4,443
................................................................................
Chubb 50,006 4,019
................................................................................
Hartford Financial Services 34,362 3,930
................................................................................
Aon 49,055 3,446
................................................................................
Progressive 21,135 2,980
................................................................................
Loews 33,801 2,945
................................................................................
St. Paul Companies 67,274 2,830
................................................................................
UNUM 40,987 2,275
................................................................................
MBIA 28,517 2,135
................................................................................
MGIC Investment 33,905 1,935
................................................................................
Cincinnati Financial 50,062 1,931
................................................................................
SAFECO 40,670 1,847
................................................................................
81,877
..........
Thrift Institutions 0.3%
Washington Mutual 112,555 4,886
................................................................................
H. F. Ahmanson 32,106 2,279
................................................................................
Golden West Financial 16,715 1,777
................................................................................
8,942
..........
Total Financial 466,359
..........
14
<PAGE>
T. Rowe Price Equity Index 500 Fund
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
HEALTH CARE 11.7%
Drugs, Medicine 10.0%
Merck 349,503 $ 46,746
................................................................................
Pfizer 383,419 41,673
................................................................................
Bristol-Myers Squibb 290,955 33,442
................................................................................
Johnson & Johnson 394,743 29,112
................................................................................
Eli Lilly 324,070 21,409
................................................................................
American Home Products 383,302 19,836
................................................................................
Schering-Plough 215,046 19,704
................................................................................
Abbott Laboratories 450,796 18,426
................................................................................
Warner-Lambert 241,346 16,743
................................................................................
Pharmacia & Upjohn 149,009 6,873
................................................................................
Amgen * 76,986 5,035
................................................................................
Cardinal Health 32,859 3,081
................................................................................
ALZA * 25,022 1,082
................................................................................
Allergan 18,803 872
................................................................................
Mallinkrodt 21,861 649
................................................................................
264,683
..........
Health Care (non-drug) 1.1%
Medtronic 137,985 8,797
................................................................................
Baxter International 83,104 4,472
................................................................................
Boston Scientific * 57,654 4,130
................................................................................
Guidant 44,532 3,176
................................................................................
Becton, Dickinson 36,154 2,806
................................................................................
Biomet 33,504 1,108
................................................................................
United States Surgical 22,936 1,046
................................................................................
St. Jude Medical * 25,676 945
................................................................................
Bausch & Lomb 16,366 820
................................................................................
C. R. Bard 15,941 607
................................................................................
27,907
..........
HMO/Hospital Management 0.6%
Columbia/HCA Healthcare 189,804 5,528
................................................................................
United HealthCare 54,601 3,467
................................................................................
HealthSouth * 115,809 3,091
................................................................................
Tenet Healthcare * 92,019 2,875
................................................................................
Humana * 49,240 1,536
................................................................................
Manor Care 18,687 718
................................................................................
17,215
..........
Total Health Care 309,805
..........
15
<PAGE>
T. Rowe Price Equity Index 500 Fund
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
PROCESS INDUSTRIES 3.1%
Chemicals 2.4%
DuPont 328,923 $ 24,546
................................................................................
Monsanto 176,698 9,873
................................................................................
Dow Chemical 66,604 6,440
................................................................................
PPG Industries 51,654 3,593
................................................................................
Occidental Petroleum 107,839 2,912
................................................................................
Air Products and Chemicals 67,976 2,719
................................................................................
Praxair 45,938 2,151
................................................................................
Union Carbide 39,780 2,123
................................................................................
Rohm & Haas 18,017 1,873
................................................................................
Avery Dennison 30,104 1,618
................................................................................
Eastman Chemical 23,474 1,461
................................................................................
Hercules 27,401 1,127
................................................................................
Sigma Aldrich 28,498 1,003
................................................................................
Morton International 37,966 949
................................................................................
Engelhard 42,665 864
................................................................................
Nalco Chemical 19,652 690
................................................................................
Great Lakes Chemical 16,716 659
................................................................................
W. R. Grace 19,709 336
................................................................................
64,937
..........
Forest Products 0.0%
Louisiana Pacific 30,457 556
................................................................................
556
..........
Paper 0.7%
International Paper 88,405 3,801
................................................................................
Fort James 64,507 2,871
................................................................................
Weyerhaeuser 58,490 2,701
................................................................................
Georgia-Pacific 26,709 1,574
................................................................................
Champion International 29,167 1,435
................................................................................
Willamette Industries 33,673 1,077
................................................................................
Union Camp 20,074 996
................................................................................
Mead 30,991 984
................................................................................
Westvaco 30,221 854
................................................................................
Boise Cascade 16,035 525
................................................................................
Stone Container * 30,572 478
................................................................................
Potlatch 8,943 376
................................................................................
17,672
..........
Total Process Industries 83,165
..........
16
<PAGE>
T. Rowe Price Equity Index 500 Fund
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
TECHNOLOGY 16.2%
Aerospace 0.8%
Boeing 297,271 $ 13,247
................................................................................
Lockheed Martin 56,910 6,025
................................................................................
General Dynamics 36,088 1,678
................................................................................
B. F. Goodrich 20,163 1,001
................................................................................
21,951
..........
Analytical Equipment 0.9%
Emerson Electric 128,365 7,750
................................................................................
Raytheon (Class B) 88,974 5,261
................................................................................
Honeywell 37,293 3,116
................................................................................
Northrop 19,430 2,004
................................................................................
Thermo Electron * 47,447 1,622
................................................................................
Perkin-Elmer 14,674 912
................................................................................
KLA-Tencor * 25,189 698
................................................................................
Snap-On 17,175 623
................................................................................
Raytheon (Class A) 10,200 588
................................................................................
Tektronix 14,106 499
................................................................................
Millipore 11,619 317
................................................................................
23,390
..........
Business Machines 4.0%
IBM 282,778 32,466
................................................................................
Hewlett-Packard 303,396 18,166
................................................................................
Dell Computer * 190,590 17,683
................................................................................
COMPAQ Computer 482,859 13,701
................................................................................
Xerox 96,144 9,771
................................................................................
Sun Microsystems * 110,344 4,796
................................................................................
Pitney Bowes 84,364 4,060
................................................................................
Gateway 2000 * 45,700 2,314
................................................................................
Apple Computer * 37,670 1,082
................................................................................
Silicon Graphics * 54,562 662
................................................................................
Ikon Office Solutions 38,290 558
................................................................................
Data General * 12,138 181
................................................................................
105,440
..........
Communications Equipment 2.2%
Lucent Technologies 385,222 32,046
................................................................................
Motorola 174,795 9,188
................................................................................
Northern Telecom 152,049 8,629
................................................................................
17
<PAGE>
T. Rowe Price Equity Index 500 Fund
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
Tellabs * 52,159 $ 3,734
................................................................................
General Instrument * 44,303 1,204
................................................................................
DSC Communications * 36,671 1,098
................................................................................
Harris 23,459 1,048
................................................................................
Scientific-Atlanta 24,385 619
................................................................................
57,566
..........
Computer Communications 1.4%
Cisco Systems * 299,862 27,616
................................................................................
3Com * 102,876 3,160
................................................................................
Ascend Communications * 56,400 2,794
................................................................................
Bay Networks * 64,539 2,081
................................................................................
Cabletron Systems * 43,696 587
................................................................................
36,238
..........
Computer Peripherals 0.3%
EMC * 146,540 6,567
................................................................................
Seagate Technology * 72,713 1,731
................................................................................
8,298
..........
Computer Services 0.8%
Automatic Data Processing 87,595 6,383
................................................................................
HBO 126,740 4,471
................................................................................
First Data 123,674 4,120
................................................................................
Computer Sciences 44,808 2,868
................................................................................
Unisys * 72,173 2,039
................................................................................
Shared Medical Systems 7,621 560
................................................................................
20,441
..........
Computer Software 3.7%
Microsoft * 722,266 78,298
................................................................................
Computer Associates 158,973 8,833
................................................................................
Oracle * 288,045 7,066
................................................................................
Parametric Technology * 79,176 2,145
................................................................................
Novell * 105,668 1,350
................................................................................
Adobe Systems 20,606 876
................................................................................
Autodesk 13,435 518
................................................................................
99,086
..........
Electronic Manufacturing Equipment 0.1%
Applied Materials * 106,335 3,140
................................................................................
3,140
..........
18
<PAGE>
T. Rowe Price Equity Index 500 Fund
- --------------------------------------------------------------------------------
Shares/Par Value
- --------------------------------------------------------------------------------
In thousands
Electronics 2.0%
Intel 497,927 $ 36,893
................................................................................
Texas Instruments 114,385 6,670
................................................................................
Rockwell International 59,182 2,845
................................................................................
AMP 64,038 2,201
................................................................................
Micron Technology * 60,667 1,505
................................................................................
LSI Logic * 41,486 957
................................................................................
Thomas & Betts 15,693 773
................................................................................
Raychem 25,126 743
................................................................................
Advanced Micro Devices * 39,782 679
................................................................................
National Semiconductor * 46,351 611
................................................................................
Andrew * 26,847 484
................................................................................
54,361
..........
Total Technology 429,911
..........
UTILITIES 9.1%
Electric Utilities 2.4%
Duke Energy 105,023 6,223
................................................................................
Southern Company 205,222 5,682
................................................................................
PG&E 124,079 3,916
................................................................................
FPL Group 53,464 3,368
................................................................................
Edison International 111,987 3,311
................................................................................
Consolidated Edison 69,360 3,195
................................................................................
Texas Utilities 74,184 3,088
................................................................................
Houston Industries 81,504 2,516
................................................................................
American Electric Power 54,838 2,488
................................................................................
Public Service Enterprise 68,515 2,360
................................................................................
Dominion Resources 56,472 2,301
................................................................................
Unicom 62,735 2,200
................................................................................
Entergy 74,029 2,128
................................................................................
FirstEnergy 67,515 2,076
................................................................................
PacifiCorp 88,592 2,004
................................................................................
PECO Energy 65,717 1,918
................................................................................
Carolina Power & Light 44,135 1,914
................................................................................
DTE Energy 42,769 1,727
................................................................................
Central and South West 62,238 1,673
................................................................................
CINergy 45,439 1,590
................................................................................
Ameren 39,988 1,590
................................................................................
19
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares/par Value
- -------------------------------------------------------------------------------------
In thousands
<S> <C> <C>
GPU 36,769 $ 1,390
..................................................................................
BGE 42,799 1,329
..................................................................................
Northern States Power 44,432 1,272
..................................................................................
PP&L Resources 46,846 1,063
..................................................................................
Niagara Mohawk * 41,016 613
..................................................................................
62,935
..............
Telephone, Telegraph 6.7%
AT&T 474,787 27,122
..................................................................................
SBC Communications 540,750 21,630
..................................................................................
Bell Atlantic 455,890 20,800
..................................................................................
BellSouth 290,269 19,484
..................................................................................
GTE 281,845 15,678
..................................................................................
WorldCom * 301,385 14,570
..................................................................................
Ameritech 324,277 14,552
..................................................................................
MCI 211,146 12,266
..................................................................................
AirTouch Communications * 167,198 9,771
..................................................................................
Sprint 125,674 8,860
..................................................................................
U.S. WEST Communications 145,824 6,854
..................................................................................
ALLTEL 54,900 2,553
..................................................................................
NEXTEL Communications * 80,700 2,005
..................................................................................
Frontier 50,844 1,601
..................................................................................
177,746
..............
Total Utilities 240,681
..............
Total Common Stocks (Cost $1,770,165) 2,629,711
..............
Short-Term Investments 0.9%
U.S. Government Obligations 0.1%
U.S. Treasury Bills, 5.03 - 5.09%, 9/10 - 10/15/98 $ 3,000,000 2,965
..................................................................................
2,965
..............
Money Market Funds 0.8%
Reserve Investment Fund, 5.69% # 21,888,410 21,889
..................................................................................
21,889
..............
Total Short-Term Investments (Cost $24,854) 24,854
..............
</TABLE>
20
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Shares/par Value
- --------------------------------------------------------------------------------
In thousands
Total Investments in Securities
100.2% of Net Assets (Cost $1,795,019) $ 2,654,565
Futures Contracts
In thousands
Contract Unrealized
Expiration Value Gain (Loss)
---------- -------- -----------
Long, 70 Standard & Poor's 500 Stock Index
contracts, $1,500,000 Of U.S. Treasury Bills
pledged as initial margin 9/98 $20,003 $ 429
Net payments (receipts) of variation
margin to date (573)
...........
Variation margin receivable
(payable) on open futures contracts (145)
Other Assets Less Liabilities (4,623)
...........
NET ASSETS $2,649,797
...........
NET ASSETS CONSIST OF:
Accumulated net investment income - net of distributions $ 722
Accumulated net realized gain/loss - net of distributions 19,874
Net unrealized gain (loss) 859,975
Paid-in-capital applicable to 86,002,588 shares of $0.01 par
value capital stock outstanding; 1,000,000,000 shares authorized 1,769,226
...........
NET ASSETS $2,649,797
-----------
NET ASSET VALUE PER SHARE $30.81
-----------
* Non-income producing
# Seven-day yield
ADR American Depository Receipt
The accompanying notes are an integral part of these financial statements.
21
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Unaudited
- -----------------------
Statement of Operations
- --------------------------------------------------------------------------------
In thousands
6 Months
Ended
6/30/98
Investment Income
Income
Dividend $ 16,884
Interest 1,250
..........
Total income 18,134
..........
Expenses
Shareholder servicing 2,234
Investment management 1,974
Registration 167
Custody and accounting 107
Prospectus and shareholder reports 79
Legal and audit 13
Directors 6
Miscellaneous 10
..........
Total expenses 4,590
..........
Net investment income 13,544
..........
Realized and Unrealized Gain (Loss)
Net realized gain (loss)
Securities 14,642
Futures 4,910
..........
Net realized gain (loss) 19,552
..........
Change in net unrealized gain or loss
Securities 326,856
Futures 349
..........
Change in net unrealized gain or loss 327,205
..........
Net realized and unrealized gain (loss) 346,757
..........
INCREASE (DECREASE) IN NET
ASSETS FROM OPERATIONS $ 360,301
----------
The accompanying notes are an integral part of these financial statements.
22
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Unaudited
- ----------------------------------
Statement of Changes in Net Assets
- --------------------------------------------------------------------------------
In thousands
6 Months Year
Ended Ended
6/30/98 12/31/97
INCREASE (DECREASE) IN NET ASSETS
Operations
Net investment income $ 13,544 $ 20,941
Net realized gain (loss) 19,552 13,440
Change in net unrealized gain or loss 327,205 328,370
..........................
Increase (decrease) in net assets from operations 360,301 362,751
..........................
Distributions to shareholders
Net investment income (13,225) (20,538)
Net realized gain (1,585) (15,557)
..........................
Decrease in net assets from distributions (14,810) (36,095)
..........................
Capital share transactions*
Shares sold 693,627 1,089,014
Distributions reinvested 14,434 35,129
Shares redeemed (312,164) (350,274)
Redemption fees received 88 141
..........................
Increase (decrease) in net assets from capital
share transactions 395,985 774,010
..........................
NET ASSETS
Increase (decrease) during period 741,476 1,100,666
Beginning of period 1,908,321 807,655
..........................
End of period $ 2,649,797 $ 1,908,321
--------------------------
*Share information
Shares sold 24,002 45,621
Distributions reinvested 477 1,426
Shares redeemed (10,820) (14,418)
..........................
Increase (decrease) in shares outstanding 13,659 32,629
The accompanying notes are an integral part of these financial statements.
23
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
Unaudited June 30, 1998
- ------------------------------
Notes to Financial Statements
- --------------------------------------------------------------------------------
NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES
T. Rowe Price Equity Market Index Funds, Inc. (the corporation) is registered
under the Investment Company Act of 1940. The Equity Index 500 Fund (the
fund), a diversified, open-end management investment company, is one of the
portfolios established by the corporation and commenced operations on March
30, 1990.
The accompanying financial statements are prepared in accordance with
generally accepted accounting principles for the investment company industry;
these principles may require the use of estimates by fund management.
VALUATION Equity securities listed or regularly traded on a securities
exchange are valued at the last quoted sales price on the day the valuations
are made. A security which is listed or traded on more than one exchange is
valued at the quotation on the exchange determined to be the primary market
for such security. Listed securities not traded on a particular day and
securities regularly traded in the over-the-counter market are valued at the
mean of the latest bid and asked prices. Other equity securities are valued
at a price within the limits of the latest bid and asked prices deemed by the
Board of Directors, or by persons delegated by the Board, best to reflect
fair value.
Short-term debt securities are valued at amortized cost which, when combined
with accrued interest, approximates fair value.
Investments in mutual funds are valued at the closing net asset value per
share of the mutual fund on the day of valuation. Financial futures contracts
are valued at closing settlement prices.
For purposes of determining the fund's net asset value per share, the U.S.
dollar value of all assets and liabilities initially expressed in foreign
currencies is determined by using the mean of the bid and offer prices of
such currencies against U.S. dollars quoted by a major bank.
Assets and liabilities for which the above valuation procedures are
inappropriate or are deemed not to reflect fair value are stated at fair
value as determined in good faith by or under the supervision of the officers
of the fund, as authorized by the Board of Directors.
CURRENCY TRANSLATION Assets and liabilities are translated into U.S. dollars
at the prevailing exchange rate at the end of the reporting period. Purchases
and sales
24
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
of securities and income and expenses are translated into U.S. dollars at the
prevailing exchange rate on the dates of such transactions. The effect of
changes in foreign exchange rates on realized and unrealized security gains
and losses is reflected as a component of such gains and losses.
PREMIUMS AND DISCOUNTS Premiums and discounts on debt securities are
amortized for both financial reporting and tax purposes.
OTHER Income and expenses are recorded on the accrual basis. Investment
transactions are accounted for on the trade date. Realized gains and losses
are reported on the identified cost basis. Dividend income and distributions
to shareholders are recorded by the fund on the ex-dividend date. Income and
capital gain distributions are determined in accordance with federal income
tax regulations and may differ from those determined in accordance with
generally accepted accounting principles. Payments ("variation margin") made
or received by the fund to settle the daily fluctuations in the value of
futures contracts are recorded as unrealized gains or losses until the
contracts are closed. Unrealized gains and losses on futures contracts are
included.
NOTE 2 - INVESTMENT TRANSACTIONS
Consistent with its investment objective, the fund engages in the following
practices to manage exposure to certain risks or enhance performance. The
investment objective, policies, program, and risk factors of the fund are
described more fully in the fund's prospectus and Statement of Additional
Information.
FUTURES CONTRACTS At June 30, 1998, the fund was a party to futures
contracts, which provide for the future sale by one party and purchase by
another of a specified amount of a specific financial instrument at an agreed
upon price, date, time, and place. Risks arise from possible illiquidity of
the futures market and from movements in security values.
SECURITIES LENDING The fund lends its securities to approved brokers to earn
additional income and receives cash and U.S. Treasury securities as
collateral against the loans. Cash collateral received is invested in a money
market pooled account by the fund's lending agent. Collateral is maintained
over the life of the loan in an amount not less than 100% of the value of
loaned securities. Although risk is mitigated by the collateral, the fund
could experience a delay in recovering its securities and a possible loss of
income or value if the
25
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
borrower fails to return them. At June 30, 1998, the value of loaned
securities was $86,573,854; aggregate collateral consisted of $82,936,301 in
the securities lending collateral pool.
OTHER Purchases and sales of portfolio securities, other than short-term
securities, aggregated $442,556,000 and $26,564,000, respectively, for the
six months ended June 30, 1998.
NOTE 3 - FEDERAL INCOME TAXES
No provision for federal income taxes is required since the fund intends to
continue to qualify as a regulated investment company and distribute all of
its taxable income.
At June 30, 1998, the aggregate cost of investments for federal income tax
and financial reporting purposes was $1,795,019,000, and net unrealized gain
aggregated $859,546,000, of which $883,107,000 related to appreciated
investments and $23,561,000 to depreciated investments.
NOTE 4 - RELATED PARTY TRANSACTIONS
The investment management and administrative agreement between the fund and
T. Rowe Price Associates, Inc. (the manager) provides for an all-inclusive
annual fee, of which $348,000 was payable at June 30, 1998. The fee is
computed daily and paid monthly, and is equal to 0.20% of the fund's average
daily net assets.
Under the terms of the investment management agreement, the manager is
required to bear any expenses through December 31, 1999, which would cause
the fund's ratio of expenses to average net assets to exceed 0.40%.
Thereafter, through December 31, 2001, the fund is required to reimburse the
manager for these expenses, provided that average net assets have grown or
expenses have declined sufficiently to allow reimbursement without causing
the fund's ratio of expenses to average net assets to exceed 0.40%. Pursuant
to this agreement, $318,000 of management fees were not accrued by the fund
for the six months ended June 30, 1998. Additionally, $653,000 of unaccrued
management fees from a previous agreement are subject to reimbursement
through December 31, 1999.
In addition, the fund has entered into agreements with the manager and two
wholly owned subsidiaries of the manager, pursuant to which the fund receives
certain other services. The manager computes the daily share price
26
<PAGE>
T. ROWE PRICE EQUITY INDEX 500 FUND
- --------------------------------------------------------------------------------
and maintains the financial records of the fund. T. Rowe Price Services,
Inc., is the fund's transfer and dividend disbursing agent and provides
shareholder and administrative services to the fund. T. Rowe Price Retirement
Plan Services, Inc., provides subaccounting and recordkeeping services for
certain retirement accounts invested in the fund. The fund incurred expenses
pursuant to these related party agreements totaling approximately $2,022,000
for the six months ended June 30, 1998, of which $366,000 was payable at
period-end.
The fund may invest in the Reserve Investment Fund and Government Reserve
Investment Fund (collectively, the Reserve Funds), open-end management
investment companies managed by T. Rowe Price Associates, Inc. The Reserve
Funds are offered as cash management options only to mutual funds and other
accounts managed by T. Rowe Price and its affiliates and are not available to
the public. The Reserve Funds pay no investment management fees.
Distributions from the Reserve Funds to the fund for the six months ended
June 30, 1998, totaled $1,031,000 and are reflected as interest income in the
accompanying Statement of Operations.
27
<PAGE>
For yield, price, last transaction,
current balance, or to conduct
transactions, 24 hours, 7 days
a week, call Tele*Access(R):
1-800-638-2587 toll free
For assistance
with your existing
fund account, call:
Shareholder Service Center
1-800-225-5132 toll free
410-625-6500 Baltimore area
To open a Discount Brokerage
account or obtain information,
call: 1-800-638-5660 toll free
Internet address:
www.troweprice.com
T. Rowe Price Associates
100 East Pratt Street
Baltimore, Maryland 21202
This report is authorized for
distribution only to shareholders
and to others who have received a
copy of the prospectus of the T. Rowe
Price Equity Market Index Funds.
Investor Centers:
101 East Lombard St.
Baltimore, MD 21202
T. Rowe Price
Financial Center
10090 Red Run Blvd.
Owings Mills, MD 21117
Farragut Square
900 17th Street, N.W.
Washington, D.C. 20006
ARCO Tower
31st Floor
515 South Flower St.
Los Angeles, CA 90071
4200 West Cypress St.
10th Floor
Tampa, FL 33607
[LOGO OF T. ROWE PRICE APPEARS HERE]
T. Rowe Price Investment Services, Inc., Distributor. F50-051 6/30/98
