Report to 30 June 1999

MORGAN GRENFELL EQUITY INCOME TRUST PLC
9 July 1999

                                 
                        REPORT TO 30 JUNE 1999
                                   
MARKET BACKGROUND

The UK equity market, as measured by the FTSE All-Share Index, rose  by
just  1.8% in capital terms in the three months to 30 June.   This  was
despite continued evidence of reasonable growth in the economy and  two
further  0.25%  reductions in interest rates.  The  constraint  on  the
market  was  the  uncertainty over the direction of  US  interest  rate
policy,  together  with some signs of a pick-up  in  commodity  prices.
Small  and medium sized companies outperformed the market by  9.5%  and
5.8%  respectively,  driven  by  a recovery  in  the  share  prices  of
companies more sensitive to the rate of economic growth.  As a  result,
industrial sectors such as Resources, Steel, Chemicals, Automobiles and
Packaging all performed well.

The  portfolio benefited from this and our diluted net asset value rose
8.4% outperforming the FTSE All-Shares Index by 6.6%, thereby adding to
the outperformance achieved in the six months to 31 March.

Activity  over  the  period contained a mixture of  growth  and  income
ideas.   We bought some situations where we felt that the downside  was
limited  and  change will realise value, good examples  being  Unigate,
Rank and Tomkins.  On the growth track we purchased AstraZeneca after a
period of sharp underperformance and established a holding in Euromoney
Institutional Investor, a little followed yet attractive media company.
On  the  sale  side we began to reduce the holding in Lonmin  (formerly
Lonrho) which has been a successful resource investment.  We also  took
advantage  of the strong move in some of the cyclical shares to  reduce
or  sell out, good examples being Barratt Developments, Williams,  Arjo
Wiggins and Premier Farnell.

Our  overall  strategy is unaltered from that described in  the  recent
interim  report, namely we continue to see a low inflation  environment
with  only  very  modest growth and this leads us  to  be  cautious  of
pursuing companies that are reliant on a strong resurgence in inflation
and growth.

NET ASSET VALUE
                                                Fully diluted
                       30/06/99   31/03/99   30/06/99  31/03/99
                         256.4p     236.7p     249.8p    230.9p

MID-MARKET SHARE PRICE               30/06/99   31/03/99
Ordinary Shares                       211.0p     210.75p
Warrants                              105.50p    99.50p

LARGEST  HOLDINGS  (market value £59.3 million  equal  to 60.5% of total
portfolio)
                                               
                                                  % of
30/06/99          £'000's   portfolio
                                                    
BP Amoco                              6,159       6.3
HSBC Holdings                         4,334       4.4
British Telecom                       4,034       4.1
Glaxo Wellcome                        3,453       3.5
AstraZeneca                           3,024       3.1
Cookson Group                         2,800   2.9
Shell Transport & Trading             2,664       2.7
Royal & Sun Alliance                  2,429       2.5
Vodafone Airtouch                     2,314       2.4
Cable & Wireless                      2,271       2.3
General Electric                      2,199       2.2
British American Tobacco              2,092       2.1
SmithKline Beecham                    2,030       2.1
Barclays                       1,913       2.0
BPB                                   1,880       1.9
Billiton                              1,840       1.9
United Utilities                      1,725       1.8
National Westminster                  1,679       1.7
Carlton Communications                1,673       1.7
Diageo                                1,562       1.6
Unigate 1,501       1.5
Bass                                  1,457       1.5
Express Dairies                       1,440       1.5
British Aerospace                     1,412       1.4
Countrywide Assured                   1,404       1.4
                                                         

For  further  information, contact Adrian Frost at Morgan  Grenfell  on
0171-545-6000.

For  additional  copies, changes of address or details of  our  Private
Investors'  Plan  contact Mark Pope on 0171-545-0520,  e-mail  address:
[e-mail]

Issued  by  Morgan  Grenfell Equity Income Trust PLC  and  approved  by
Morgan  Grenfell  Trust Managers Limited, regulated by  the  Investment
Management  Regulatory  Organisation and  manager  of  Morgan  Grenfell
Equity  Income  Trust  PLC.   Investors  should  be  aware  that   past
performance  is not necessarily a guide to future returns,  values  can
fall  as  well as rise and investors may not get back the  amount  they
invested.