CMA
CMA CONNECTICUT
MUNICIPAL MONEY FUND
Semi-Annual Report
September 30, 1995
MERRILL LYNCH BULL LOGO
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance, which will fluctuate. The Fund
seeks to maintain a consistent $1.00 net asset value per share,
although this cannot be assured. An investment in the Fund is
neither insured nor guaranteed by the US Government.
<PAGE>
CMA Connecticut
Municipal Money Fund
Box 9011
Princeton, NJ 08543-9011
To Our Shareholders:
For the six-month period ended September 30, 1995, CMA Connecticut
Municipal Money Fund paid shareholders a net annualized yield of
3.08%*. As of September 30, 1995, the Fund's 7-day yield was 3.09%.
The Environment
After losing momentum through the second calendar quarter, it now
appears that the US economy has resumed a moderate growth trend.
Gross domestic product growth for the three months ended June 30 was
revised to show that the economy expanded at a 1.1% pace, rather
than the 0.5% rate that was originally reported. The employment
report for August exceeded consensus expectations, although most of
the new jobs created were in the service sector, reflecting the
ongoing sluggishness in manufacturing. However, durable goods orders
rebounded somewhat in August, supported by stronger automobile
sales. Reflecting the trend of renewed economic growth--and
continued containment of inflationary pressures--the Federal Reserve
Board signaled no shift in monetary policy following its September
meeting.
<PAGE>
One of the major developments during the latter part of the period
under review was the strengthening of the US dollar relative to the
yen and the Deutschemark. Improving interest rate differentials
favoring the US currency, combined with coordinated central bank
intervention and more positive investor sentiment, have helped to
bolster the dollar in foreign exchange markets. Other factors that
appear to be improving the US dollar's outlook in the near term are
a pick-up in capital flows to the United States and the prospect of
increased capital outflows from Japan. However, it remains to be
seen if the US dollar's strengthening trend can continue without
significant improvements in the US budget and trade deficits.
[FN]
*Based on a constant investment throughout the period, with
dividends compounded daily, and reflecting a net return to the
investor after all expenses.
In the weeks ahead, investor interest will continue to focus on US
economic activity. Clear signs of a moderate, noninflationary
expansion could further benefit the US stock and bond markets. In
addition, should the current Federal budget deficit reduction
efforts now underway in Washington prove successful, the
implications would likely be positive for the US financial markets.
Investment Outlook and Strategy
Short-term interest rates continued to fall relatively unabated
during the six-month period ended September 30, 1995 as they have
been since late 1994. A series of economic data releases indicated
that the severely restrictive monetary policy undertaken by the
Federal Reserve Board in 1994 had taken effect on the US economy in
the form of moderating growth. Additionally, the news on inflation
continued to be overwhelmingly favorable, which provided the
backdrop for a falling interest rate environment. Investors began to
anticipate that the Federal Reserve Board eventually would have to
begin cutting interest rates to avoid the possibility of a recession
in the United States. In fact, on July 6, 1995, the Federal Reserve
Board cut its key interest rate by 25 basis points (0.25%) to 5.75%,
confirming that an economic switch had occurred and signaling a
change in monetary policy from a restrictive stance to a more
neutral stance. This series of events provided the impetus for the
yield curve to flatten over the course of the six-month period ended
September 30, 1995. For instance, while yields on three-month US
Treasury bills fell approximately 45 basis points during the period,
the yield on one-year US Treasury bills dropped nearly 95 basis
points during the same period.
Over the six-month period ended September 30, 1995, Connecticut's
workforce continued to feel the effects of downsizing in the core
industries of defense, insurance and finance. Employers such as
General Dynamics are expected to continue job reductions through the
next few years as defense spending is further diminished. Despite
its modest pace of growth throughout the recent recovery, the State
continues to maintain above average-wealth levels as well as a
manageable debt level burden. Standard & Poor's Corp. has recently
reaffirmed the State's AA- rating on $5.6 billion in outstanding
general obligation debt. Additionally, the State treasurer has
authorized the issuance of $400 million in tax-exempt commercial
paper to be utilized for cash flow purposes.
<PAGE>
CMA Connecticut Municipal Money Fund maintained a relatively
defensive posture as the average portfolio maturity remained in the
30-day--35-day range for much of the six-month period ended
September 30, 1995. The short-term interest rate yield curve through
one year continued to be flat, making an extension of the Fund's
average portfolio maturity unattractive. In such an environment,
yields on shorter-term securities remain at or near those of longer-
term securities such that investors receive no yield premium as a
reward for extending their maturity risk. However, a steepening
yield curve developed toward the close of the period, allowing the
Fund to extend its average portfolio maturity to the mid 50-day
range by period-end. Subject to market conditions, we expect to
maintain this average portfolio maturity as the strength of recent
economic data has cast some doubt as to the timing and magnitude of
the Federal Reserve Board's next move.
In Conclusion
We thank you for your support of CMA Connecticut Municipal Money
Fund, and we look forward to serving your investment needs in the
future.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
(Steven T. Lewis)
Steven T. Lewis
Portfolio Manager
October 30, 1995
<PAGE>
We are pleased to announce that Steven T. Lewis is responsible for
the day-to-day management of CMA Connecticut Municipal Money Fund.
Mr. Lewis has been employed by Merrill Lynch Asset Management, L.P.
since 1988.
Portfolio Abbreviations for CMA Connecticut Municipal Money Fund
AMT Alternative Minimum Tax (subject to)
BAN Bond Anticipation Notes
CP Commercial Paper
GO General Obligation Bonds
HFA Housing Finance Agency
IDA Industrial Development Authority
PCR Pollution Control Revenue Bonds
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<TABLE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF SEPTEMBER 30, 1995 (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Connecticut-- $ 1,000 Connecticut State Clean Water Fund Revenue Bonds, 6.40% due 1/01/1996 $ 1,006
87.8% 12,500 Connecticut State Development Authority, Health Care Revenue Bonds
(Independent Living Project), VRDN, 4.20% due 7/01/2015 (a) 12,500
5,420 Connecticut State Development Authority, IDA, Revenue Bonds (Sealectro
Corporation Project), 4.90% due 12/01/1997 5,420
Connecticut State Development Authority, PCR, Refunding, VRDN (a):
5,000 (Connecticut Light & Power Co. Project), AMT, Series B, 4.50%
due 9/01/2028 5,000
6,900 (Connecticut Light & Power Co. Project), Series A, 4.40% due 9/01/2028 6,900
9,200 (Western Massachusetts Electric Co.), Series A, 4.25% due 9/01/2028 9,200
6,000 Connecticut State Development Authority, Water Facility Revenue Bonds
(Bridgeport Hydraulic Co. Project), VRDN, AMT, 4.10% due 4/01/2035 (a) 6,000
Connecticut State Economic Recovery Notes:
5,000 Series A, 5.40% due 12/15/1995 5,021
1,000 Series A, 5.50% due 6/15/1996 1,011
19,100 VRDN, Series B, 4.35% due 6/01/1996 (a) 19,100
6,000 Connecticut State GO, UT, Series B, 4.90% due 11/15/1995 6,009
Connecticut State Health and Educational Facilities Authority Revenue Bonds:
5,250 CP, 3.65% due 10/17/1995 5,250
3,530 (Yale-New Haven Hospital), Series B, 4% due 6/01/1996 (b) 3,530
<PAGE> 5,075 (Yale University), CP, Series L, 3.70% due 12/08/1995 5,075
1,000 (Yale University), CP, Series L, 3.80% due 12/11/1995 1,000
5,300 (Yale University), CP, Series M, 3.70% due 12/08/1995 5,300
5,800 (Yale University), CP, Series N, 3.70% due 12/08/1995 5,800
1,950 (Yale University), CP, Series O, 3.70% due 12/08/1995 1,950
5,000 (Yale University), CP, Series P, 3.70% due 12/08/1995 5,000
Connecticut State HFA (Housing Mortgage Finance Program), CP, AMT, Series D:
9,865 3.65% due 11/07/1995 9,865
5,350 3.65% due 12/08/1995 5,350
2,965 3.90% due 12/08/1995 2,965
12,000 Connecticut State Municipal Electric Energy Power Supply System Revenue
Bonds, CP, Series A, 3.50% due 11/16/1995 12,000
Connecticut State Special Assessment Unemployment Compensation, Advanced
Fund Revenue Bonds (Connecticut Unemployment):
14,800 Series C, 3.90% due 7/01/1996 (b) 14,799
22,000 VRDN, Series B, 4.35% due 11/01/2001 (a) 22,000
</TABLE>
<TABLE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
SCHEDULE OF INVESTMENTS AS OF SEPTEMBER 30, 1995 (IN THOUSANDS)
<CAPTION>
Face Value
State Amount Issue (Note 1a)
<S> <C> <S> <C>
Connecticut $12,395 Connecticut State Special Tax Obligation Revenue Bonds (Transportation
(concluded) Infrastructure), VRDN, Second Lien, Series 1, 4.20% due 12/01/2010 (a) $ 12,395
1,940 Farmington, Connecticut, BAN, UT, 3.50% due 1/24/1996 1,941
2,800 Groton City, Connecticut, BAN, UT, 4.50% due 11/15/1995 2,802
4,085 Norwich, Connecticut, BAN, 4.50% due 10/05/1995 4,085
4,850 Shelton, Connecticut, BAN, UT, 3.75% due 2/01/1996 4,854
4,050 South Central Connecticut Regional Water Authority, Water System Revenue
Bonds (Putters), VRDN, Series 30-A, 4.30% due 8/01/2006 (a) 4,050
7,500 Stamford, Connecticut, Housing Authority Revenue Bonds (Morgan Street
Project), VRDN, AMT, 4.20% due 8/01/2024 (a) 7,500
5,550 Torrington, Connecticut, BAN, 4.25% due 10/16/1995 5,553
9,800 Windham, Connecticut, BAN, UT, 3.60% due 12/15/1995 9,802
3,000 Windsor Locks, Connecticut, BAN, 3.75% due 5/15/1996 3,006
<PAGE>
Puerto Rico-- Puerto Rico Commonwealth, Government Development Bank Revenue Bonds:
14.8% 6,000 CP, 3.70% due 12/12/1995 6,000
5,000 CP, 3.70% due 12/13/1995 5,000
400 Refunding, VRDN, 3.80% due 12/01/2015 (a) 400
10,500 Puerto Rico Housing Finance Corporation, Medical Revenue Bonds, VRDN, 3.75%
due 10/01/2011 (a) 10,500
6,700 Puerto Rico Industrial, Medical and Environmental Pollution Control Facilities,
Financing Authority Revenue Bonds (Ana G. Mendez Educational Project), CP,
3.60% due 12/08/1995 6,700
Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control
Facilities Financing Authority, CP, Series A:
6,000 3.70% due 10/02/1995 6,000
4,700 3.70% due 12/13/1995 4,700
Total Investments (Cost--$272,339*)--102.6% 272,339
Liabilities in Excess of Other Assets--(2.6%) (6,976)
--------
Net Assets--100.0% $265,363
========
<FN>
(a)The interest rate is subject to change periodically based on
certain indexes. The interest rate shown is the rate in effect at
September 30, 1995.
(b)FGIC Insured.
*Cost for Federal income tax purposes.
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
STATEMENT OF ASSETS AND LIABILITIES AS OF SEPTEMBER 30, 1995
<S> <C> <C>
Assets:
Investments, at value (identified cost--$272,339,407) (Note 1a) $ 272,339,407
Cash 485,298
Receivables:
Interest $ 1,404,116
Beneficial interest sold 353,102 1,757,218
-------------
Deferred organization expenses (Note 1d) 8,049
Prepaid registration fees and other assets (Note 1d) 17,559
-------------
Total assets 274,607,531
-------------
Liabilities:
Payables:
Securities purchased 9,001,192
Investment adviser (Note 2) 109,864
Distributor (Note 2) 68,407 9,179,463
-------------
Accrued expenses and other liabilities 65,225
-------------
Total liabilities 9,244,688
-------------
Net Assets $ 265,362,843
=============
Net Assets Consist of:
Shares of beneficial interest, $0.10 par value, unlimited number of
shares authorized $ 26,549,886
Paid-in capital in excess of par 238,948,976
Undistributed investment income--net 10,827
Accumulated realized capital losses--net (Note 4) (146,846)
-------------
Net Assets--Equivalent to $1.00 per share based on 265,498,863 shares of beneficial
interest outstanding $ 265,362,843
=============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1995
<S> <C> <C>
Investment Income (Note 1c):
Interest and amortization of premium and discount earned $ 5,152,371
Expenses:
Investment advisory fees (Note 2) $ 680,557
Distribution fees (Note 2) 169,556
Registration fees (Note 1d) 32,214
Transfer agent fees (Note 2) 24,938
Professional fees 23,854
Accounting services (Note 2) 23,570
Custodian fees 12,482
Printing and shareholder reports 11,579
Amortization of organization expenses (Note 1d) 3,789
Pricing fees 2,902
Trustees' fees and expenses 1,535
Other 2,034
-------------
Total expenses 989,010
-------------
Investment income--net 4,163,361
Realized Loss on Investments--Net (Note 1c) (320)
-------------
Net Increase in Net Assets Resulting from Operations $ 4,163,041
=============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Six For the
Months Ended Year Ended
Increase (Decrease) in Net Assets: Sept. 30, 1995 March 31, 1995
<S> <C> <C>
Operations:
Investment income--net $ 4,163,361 $ 6,517,952
Realized loss on investments--net (320) (31,149)
------------- -------------
Net increase in net assets resulting from operations 4,163,041 6,486,803
------------- -------------
Dividends to Shareholders (Note 1e):
Investment income--net (4,161,615) (6,504,917)
------------- -------------
Net decrease in net assets resulting from dividends to shareholders (4,161,615) (6,504,917)
------------- -------------
Beneficial Interest Transactions (Note 3):
Net proceeds from sale of shares 539,180,334 944,440,136
Net asset value of shares issued to shareholders in reinvestment of dividends
(Note 1e) 4,163,517 6,504,738
------------- -------------
543,343,851 950,944,874
Cost of shares redeemed (538,380,710) (940,566,013)
------------- -------------
Net increase in net assets derived from beneficial interest transactions 4,963,141 10,378,861
------------- -------------
Net Assets:
Total increase in net assets 4,964,567 10,360,747
Beginning of period 260,398,276 250,037,529
------------- -------------
End of period* $ 265,362,843 $ 260,398,276
============= =============
<FN>
*Undistributed investment income--net $ 10,827 $ 9,081
============= =============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
FINANCIAL HIGHLIGHTS
<CAPTION>
For the For the
Six Period
The following per share data and ratios have been derived Months April 29,
from information provided in the financial statements. Ended 1991++ to
Sept. 30, For the Year Ended March 31, March 31,
Increase (Decrease) in Net Asset Value: 1995 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C>
Per Share Operating Performance:
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Investment income--net .02 .03 .02 .02 .03
-------- -------- -------- -------- --------
Total from investment operations .02 .03 .02 .02 .03
-------- -------- -------- -------- --------
Less dividends from investment income--net (.02) (.03) (.02) (.02) (.03)
-------- -------- -------- -------- --------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
Total Investment Return 3.08%* 2.54% 1.77% 2.20% 3.56%*
======== ======== ======== ======== ========
Ratios to Average Net Assets:
Expenses, net of reimbursement and excluding
distribution fees .60%* .58% .58% .51% .28%*
======== ======== ======== ======== ========
Expenses, net of reimbursement .73%* .71% .70% .63% .41%*
======== ======== ======== ======== ========
Expenses .73%* .71% .70% .73% .81%*
======== ======== ======== ======== ========
Investment income--net 3.06%* 2.53% 1.76% 2.17% 3.46%*
======== ======== ======== ======== ========
Supplemental Data:
Net assets, end of period (in thousands) $265,363 $260,398 $250,038 $231,431 $197,895
======== ======== ======== ======== ========
<FN>
*Annualized.
++Commencement of Operations.
See Notes to Financial Statements.
</TABLE>
<PAGE>
CMA CONNECTICUT MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
CMA Connecticut Municipal Money Fund (the "Fund") is part of CMA
Multi-State Municipal Series Trust (the "Trust"). The Fund is
registered under the Investment Company Act of 1940 as a
non-diversified, open-end management investment company. 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 following is a summary of
significant accounting policies followed by the Fund.
(a) Valuation of investments--Investments are valued at amortized
cost, which approximates market value. For the purpose of valuation,
the maturity of a variable rate demand instrument is deemed to be
the next coupon date on which the interest rate is to be adjusted.
In the case of a floating rate instrument, the remaining maturity is
the demand notice payment period.
(b) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(c) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
premium and discount) is recognized on the accrual basis. Realized
gains and losses on security transactions are determined on the
identified cost basis.
(d) Deferred organization expenses and prepaid registration fees--
Deferred organization expenses are charged to expense on a
straight-line basis over a five-year period. Prepaid registration
fees are charged to expense as the related shares are issued.
(e) Dividends and distributions to shareholders--The Fund declares
dividends daily and reinvests daily such dividends (net of
non-resident alien tax withheld) in additional fund shares at net
asset value. Dividends are declared from the total of net investment
income, excluding discounts earned other than original issue
discounts. Net realized capital gains, if any, are normally
distributed annually after deducting prior years' loss carryforward.
The Fund may distribute capital gains more frequently than annually
in order to maintain the Fund's net asset value at $1.00 per share.
<PAGE>
2. Investment Advisory Agreement and
Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM" or "Adviser"). The general partner of
FAM is Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee based upon the average daily
value of the Fund's net assets, at the following annual rates: 0.50%
of the first $500 million of average daily net assets; 0.425% of
average daily net assets in excess of $500 million but not exceeding
$1 billion; and 0.375% of average daily net assets in excess of $1
billion.
The most restrictive annual expense limitation requires that the
Adviser reimburse the Fund to the extent the Fund's expenses
(excluding interest, taxes, distribution fees, brokerage fees and
commissions, and extraordinary items) exceed in any fiscal year 2.5%
of the Fund's first $30 million of average daily net assets, 2.0% of
the Fund's next $70 million of average daily net assets, and 1.5% of
the average daily net assets in excess thereof. No fee payment will
be made to the Adviser during the year which will cause such
expenses to exceed the pro rata expense limitation at the time of
such payment.
CMA CONNECTICUT MUNICIPAL MONEY FUND
NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
Pursuant to the Distribution and Shareholder Servicing Plan in
compliance with Rule 12b-1 under the Investment Company Act of 1940,
Merrill Lynch, Pierce, Fenner & Smith Inc. ("MLPF&S") receives a
distribution fee from the Fund at the end of each month at the
annual rate of 0.125% of average daily net assets of the Fund. The
distribution fee is to compensate MLPF&S financial consultants and
other directly involved branch office personnel for selling shares
of the Fund and for providing direct personal services to
shareholders. The distribution fee is not compensation for the
administrative and operational services rendered to the Fund by
MLPF&S in processing share orders and administering shareholder
accounts.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a
wholly-owned subsidiary of ML & Co., is the Fund's transfer agent.
<PAGE>
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, PSI, MLPF&S, MLFDS, and/or ML & Co.
3. Shares of Beneficial Interest:
The number of shares purchased and redeemed during the period
corresponds to the amounts included in the Statements of Changes in
Net Assets for net proceeds from sale of shares and cost of shares
redeemed, respectively, since shares are recorded at $1.00 per
share.
4. Capital Loss Carryforward:
At March 31, 1995, the Fund had a net capital loss carryforward of
approximately $147,000, of which $80,000 expires in 2000, $30,000
expires in 2001, $10,000 expires in 2002 and $27,000 expires in
2003. This amount will be available to offset like amounts of any
future taxable gains.
CMA CONNECTICUT MUNICIPAL MONEY FUND
Officers and Trustees
Arthur Zeikel--President and Trustee
Ronald W. Forbes--Trustee
Cynthia A. Montgomery--Trustee
Charles C. Reilly--Trustee
Kevin A. Ryan--Trustee
Richard R. West--Trustee
Terry K. Glenn--Executive Vice President
Vincent R. Giordano--Senior Vice President
Edward J. Andrews--Vice President
Donald C. Burke--Vice President
Peter J. Hayes--Vice President
Kenneth A. Jacob--Vice President
Kevin A. Schiatta--Vice President
Helen Marie Sheehan--Vice President
Gerald M. Richard--Treasurer
Robert Harris--Secretary
Custodian
State Street Bank and Trust Company
P.O. Box 1713
Boston, Massachusetts 02101
<PAGE>
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 221-7210*
[FN]
*For inquiries regarding your CMA account,
call (800) CMA-INFO [(800) 262-4636].
