N-Q 1 dnq.htm LEGG MASON BATTERYMARCH S&P 500 INDEX FUND Legg Mason Batterymarch S&P 500 Index Fund

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-06444

Legg Mason Partners Equity Trust

(Exact name of registrant as specified in charter)

55 Water Street, New York, NY 10041

(Address of principal executive offices) (Zip code)

Robert I. Frenkel, Esq.

Legg Mason & Co., LLC

100 First Stamford Place

Stamford, CT 06902

(Name and address of agent for service)

Registrant’s telephone number, including area code:

Funds Investor Services 1-800-822-5544

or

Institutional Shareholder Services 1-888-425-6432

Date of fiscal year end: September 30

Date of reporting period: June 30, 2010

 

 

 

 

ITEM 1. SCHEDULE OF INVESTMENTS.

LEGG MASON PARTNERS EQUITY TRUST

LEGG MASON BATTERYMARCH S&P 500

INDEX FUND

FORM N-Q

JUNE 30, 2010

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited)    June 30, 2010

 

SECURITY

    SHARES    VALUE  
COMMON STOCKS - 96.8%      
CONSUMER DISCRETIONARY - 9.9%      

Auto Components - 0.2%

      

Goodyear Tire & Rubber Co.

    5,647    $ 56,131 * 

Johnson Controls Inc.

    15,472      415,733   
           

Total Auto Components

         471,864   
           

Automobiles - 0.4%

      

Ford Motor Co.

    78,885      795,161 * 

Harley-Davidson Inc.

    5,405      120,153   
           

Total Automobiles

         915,314   
           

Distributors - 0.1%

      

Genuine Parts Co.

    3,662      144,466   
           

Diversified Consumer Services - 0.2%

      

Apollo Group Inc., Class A Shares

    2,916      123,842 * 

DeVry Inc.

    1,446      75,901   

H&R Block Inc.

    7,516      117,926   
           

Total Diversified Consumer Services

         317,669   
           

Hotels, Restaurants & Leisure - 1.6%

      

Carnival Corp.

    9,976      301,674   

Darden Restaurants Inc.

    3,248      126,185   

International Game Technology

    6,876      107,953   

Marriott International Inc., Class A Shares

    5,960      178,442   

McDonald’s Corp.

    24,810      1,634,235   

Starbucks Corp.

    17,241      418,956   

Starwood Hotels & Resorts Worldwide Inc.

    4,360      180,635   

Wyndham Worldwide Corp.

    4,167      83,923   

Wynn Resorts Ltd.

    1,587      121,041   

Yum! Brands Inc.

    10,766      420,305   
           

Total Hotels, Restaurants & Leisure

         3,573,349   
           

Household Durables - 0.4%

      

D.R. Horton Inc.

    6,314      62,066   

Fortune Brands Inc.

    3,506      137,365   

Harman International Industries Inc.

    1,593      47,615 * 

Leggett & Platt Inc.

    3,417      68,545   

Lennar Corp., Class A Shares

    3,692      51,356   

Newell Rubbermaid Inc.

    6,422      94,018   

Pulte Homes Inc.

    7,324      60,643 * 

Stanley Black & Decker Inc.

    3,701      186,974   

Whirlpool Corp.

    1,718      150,875   
           

Total Household Durables

         859,457   
           

Internet & Catalog Retail - 0.5%

      

Amazon.com Inc.

    7,921      865,448 * 

Expedia Inc.

    4,825      90,614   

Priceline.com Inc.

    1,084      191,369 * 
           

Total Internet & Catalog Retail

         1,147,431   
           

Leisure Equipment & Products - 0.2%

      

Eastman Kodak Co.

    6,255      27,147 * 

Hasbro Inc.

    3,025      124,327   

Mattel Inc.

    8,369      177,088   
           

Total Leisure Equipment & Products

         328,562   
           

Media - 3.0%

      

CBS Corp., Class B Shares

    15,578      201,423   

Comcast Corp., Class A Shares

    65,293      1,134,139   

DIRECTV, Class A Shares

    20,851      707,266 * 

Discovery Communications Inc., Class A Shares

    6,590      235,329 * 

Gannett Co. Inc.

    5,539      74,555   

Interpublic Group of Cos. Inc.

    11,385      81,175 * 

McGraw-Hill Cos. Inc.

    7,283      204,944   

Meredith Corp.

    843      26,243   

New York Times Co., Class A Shares

    2,678      23,165 * 

News Corp., Class A Shares

    51,324      613,835   

Omnicom Group Inc.

    7,057      242,055   

Scripps Networks Interactive, Class A Shares

    2,053      82,818   

 

See Notes to Schedule of Investments.

 

1

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

Media - continued

      

Time Warner Cable Inc.

    8,184    $ 426,223   

Time Warner Inc.

    26,247      758,801   

Viacom Inc., Class B Shares

    14,023      439,901   

Walt Disney Co.

    45,066      1,419,579   

Washington Post Co., Class B Shares

    141      57,878   
           

Total Media

         6,729,329   
           

Multiline Retail - 0.8%

      

Big Lots Inc.

    1,860      59,687 * 

Family Dollar Stores Inc.

    3,114      117,367   

J.C. Penney Co. Inc.

    5,439      116,830   

Kohl’s Corp.

    7,126      338,485 * 

Macy’s Inc.

    9,715      173,898   

Nordstrom Inc.

    3,848      123,867   

Sears Holdings Corp.

    1,107      71,568 * 

Target Corp.

    16,941      832,989   
           

Total Multiline Retail

         1,834,691   
           

Specialty Retail - 2.0%

      

Abercrombie & Fitch Co., Class A Shares

    2,047      62,822   

AutoNation Inc.

    2,069      40,346 * 

AutoZone Inc.

    678      131,003 * 

Bed Bath & Beyond Inc.

    6,228      230,934 * 

Best Buy Co. Inc.

    7,997      270,778   

CarMax Inc.

    5,141      102,306 * 

GameStop Corp., Class A Shares

    3,521      66,160 * 

Gap Inc.

    10,444      203,240   

Home Depot Inc.

    38,943      1,093,130   

Limited Brands Inc.

    6,231      137,518   

Lowe’s Cos. Inc.

    33,090      675,698   

O’Reilly Automotive Inc.

    3,183      151,384 * 

Office Depot Inc.

    6,347      25,642 * 

RadioShack Corp.

    2,894      56,462   

Ross Stores Inc.

    2,827      150,651   

Sherwin-Williams Co.

    2,132      147,513   

Staples Inc.

    16,869      321,354   

Tiffany & Co.

    2,965      112,403   

TJX Cos. Inc.

    9,488      398,022   

Urban Outfitters Inc.

    3,041      104,580 * 
           

Total Specialty Retail

         4,481,946   
           

Textiles, Apparel & Luxury Goods - 0.5%

      

Coach Inc.

    7,030      256,947   

NIKE Inc., Class B Shares

    8,991      607,342   

Polo Ralph Lauren Corp.

    1,516      110,607   

V.F. Corp.

    2,036      144,922   
           

Total Textiles, Apparel & Luxury Goods

         1,119,818   
           

TOTAL CONSUMER DISCRETIONARY

         21,923,896   
           
CONSUMER STAPLES - 11.1%      

Beverages - 2.6%

      

Brown-Forman Corp., Class B Shares

    2,483      142,102   

Coca-Cola Co.

    53,262      2,669,491   

Coca-Cola Enterprises Inc.

    7,405      191,493   

Constellation Brands Inc., Class A Shares

    4,406      68,822 * 

Dr. Pepper Snapple Group Inc.

    5,647      211,141   

Molson Coors Brewing Co., Class B Shares

    3,635      153,979   

PepsiCo Inc.

    37,142      2,263,805   
           

Total Beverages

         5,700,833   
           

Food & Staples Retailing - 2.4%

      

Costco Wholesale Corp.

    10,138      555,867   

CVS Caremark Corp.

    31,358      919,417   

Kroger Co.

    14,580      287,080   

Safeway Inc.

    8,725      171,533   

SUPERVALU Inc.

    4,829      52,346   

Sysco Corp.

    13,712      391,752   

Wal-Mart Stores Inc.

    47,868      2,301,015   

 

See Notes to Schedule of Investments.

 

2

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

Food & Staples Retailing - continued

      

Walgreen Co.

    22,545    $ 601,951   

Whole Foods Market Inc.

    3,954      142,423 * 
           

Total Food & Staples Retailing

         5,423,384   
           

Food Products - 1.9%

      

Archer-Daniels-Midland Co.

    14,817      382,575   

Campbell Soup Co.

    4,289      153,675   

ConAgra Foods Inc.

    10,202      237,911   

Dean Foods Co.

    4,140      41,690 * 

General Mills Inc.

    15,212      540,330   

H.J. Heinz Co.

    7,245      313,129   

Hershey Co.

    3,834      183,764   

Hormel Foods Corp.

    1,588      64,282   

J.M. Smucker Co.

    2,805      168,917   

Kellogg Co.

    5,853      294,406   

Kraft Foods Inc., Class A Shares

    40,182      1,125,096   

McCormick & Co. Inc., Non Voting Shares

    3,037      115,284   

Mead Johnson Nutrition Co., Class A Shares

    4,761      238,621   

Sara Lee Corp.

    15,118      213,164   

Tyson Foods Inc., Class A Shares

    7,013      114,943   
           

Total Food Products

         4,187,787   
           

Household Products - 2.5%

      

Clorox Co.

    3,236      201,150   

Colgate-Palmolive Co.

    11,269      887,546   

Kimberly-Clark Corp.

    9,510      576,591   

Procter & Gamble Co.

    66,210      3,971,276   
           

Total Household Products

         5,636,563   
           

Personal Products - 0.2%

      

Avon Products Inc.

    9,816      260,124   

Estee Lauder Cos. Inc., Class A Shares

    2,748      153,146   
           

Total Personal Products

         413,270   
           

Tobacco - 1.5%

      

Altria Group Inc.

    47,956      961,038   

Lorillard Inc.

    3,567      256,753   

Philip Morris International Inc.

    42,672      1,956,085   

Reynolds American Inc.

    3,926      204,623   
           

Total Tobacco

         3,378,499   
           

TOTAL CONSUMER STAPLES

         24,740,336   
           
ENERGY - 10.3%      

Energy Equipment & Services - 1.6%

      

Baker Hughes Inc.

    9,896      411,377   

Cameron International Corp.

    5,626      182,957 * 

Diamond Offshore Drilling Inc.

    1,605      99,815   

FMC Technologies Inc.

    2,803      147,606 * 

Halliburton Co.

    20,938      514,028   

Helmerich & Payne Inc.

    2,412      88,086   

Nabors Industries Ltd.

    6,605      116,380 * 

National-Oilwell Varco Inc.

    9,637      318,696   

Rowan Cos. Inc.

    2,668      58,536 * 

Schlumberger Ltd.

    27,486      1,521,075   

Smith International Inc.

    5,623      211,706   
           

Total Energy Equipment & Services

         3,670,262   
           

Oil, Gas & Consumable Fuels - 8.7%

      

Anadarko Petroleum Corp.

    11,434      412,653   

Apache Corp.

    7,826      658,871   

Cabot Oil & Gas Corp.

    2,329      72,944   

Chesapeake Energy Corp.

    14,970      313,622   

Chevron Corp.

    46,150      3,131,739   

ConocoPhillips

    34,368      1,687,125   

CONSOL Energy Inc.

    5,148      173,796   

Denbury Resources Inc.

    9,167      134,205 * 

Devon Energy Corp.

    10,298      627,354   

El Paso Corp.

    16,314      181,249   

 

See Notes to Schedule of Investments.

 

3

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

   

SHARES

    VALUE  

Oil, Gas & Consumable Fuels - continued

      

EOG Resources Inc.

    5,823    $ 572,809   

Exxon Mobil Corp.

    117,796      6,722,618   

Hess Corp.

    6,802      342,413   

Marathon Oil Corp.

    16,408      510,125   

Massey Energy Co.

    2,336      63,890   

Murphy Oil Corp.

    4,388      217,425   

Noble Energy Inc.

    4,000      241,320   

Occidental Petroleum Corp.

    18,840      1,453,506   

Peabody Energy Corp.

    6,202      242,684   

Pioneer Natural Resources Co.

    2,675      159,029   

Range Resources Corp.

    3,641      146,186   

Southwestern Energy Co.

    7,777      300,503 * 

Spectra Energy Corp.

    14,949      300,026   

Sunoco Inc.

    2,794      97,147   

Tesoro Corp.

    3,303      38,546   

Valero Energy Corp.

    12,950      232,841   

Williams Cos. Inc.

    13,613      248,846   
           

Total Oil, Gas & Consumable Fuels

         19,283,472   
           

TOTAL ENERGY

         22,953,734   
           
FINANCIALS - 15.8%      

Capital Markets - 2.3%

      

Ameriprise Financial Inc.

    5,877      212,336   

Bank of New York Mellon Corp.

    28,045      692,431   

Charles Schwab Corp.

    22,730      322,311   

E*TRADE Financial Corp.

    4,652      54,987 * 

Federated Investors Inc., Class B Shares

    2,031      42,062   

Franklin Resources Inc.

    3,390      292,184   

Goldman Sachs Group Inc.

    12,009      1,576,422   

Invesco Ltd.

    10,874      183,009   

Janus Capital Group Inc.

    4,258      37,811   

Legg Mason Inc.

    3,792      106,290   

Morgan Stanley

    32,299      749,660   

Northern Trust Corp.

    5,542      258,811   

State Street Corp.

    11,499      388,896   

T. Rowe Price Group Inc.

    5,981      265,497   
           

Total Capital Markets

         5,182,707   
           

Commercial Banks - 3.0%

      

BB&T Corp.

    15,962      419,960   

Comerica Inc.

    4,172      153,655   

Fifth Third Bancorp

    18,382      225,915   

First Horizon National Corp.

    5,305      60,747 * 

Huntington Bancshares Inc.

    16,548      91,676   

KeyCorp

    20,405      156,914   

M&T Bank Corp.

    1,908      162,085   

Marshall & Ilsley Corp.

    12,342      88,616   

PNC Financial Services Group Inc.

    12,223      690,600   

Regions Financial Corp.

    27,485      180,851   

SunTrust Banks Inc.

    11,602      270,327   

U.S. Bancorp

    44,170      987,199   

Wells Fargo & Co.

    120,284      3,079,270   

Zions Bancorporation

    3,709      80,003   
           

Total Commercial Banks

         6,647,818   
           

Consumer Finance - 0.8%

      

American Express Co.

    27,649      1,097,665   

Capital One Financial Corp.

    10,579      426,334   

Discover Financial Services

    12,566      175,673   

SLM Corp.

    11,078      115,100 * 
           

Total Consumer Finance

         1,814,772   
           

Diversified Financial Services - 4.4%

      

Bank of America Corp.

    231,213      3,322,531   

Citigroup Inc.

    521,713      1,961,641 * 

 

See Notes to Schedule of Investments.

 

4

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

Diversified Financial Services - continued

      

CME Group Inc.

    1,506    $ 424,014   

IntercontinentalExchange Inc.

    1,693      191,360 * 

JPMorgan Chase & Co.

    91,679      3,356,368   

Leucadia National Corp.

    4,365      85,161 * 

Moody’s Corp.

    4,597      91,572   

Nasdaq OMX Group Inc.

    3,359      59,723 * 

NYSE Euronext

    6,044      166,996   

Principal Financial Group Inc.

    7,373      172,823   
           

Total Diversified Financial Services

         9,832,189   
           

Insurance - 3.8%

      

AFLAC Inc.

    10,976      468,346   

Allstate Corp.

    12,471      358,292   

American International Group Inc.

    3,101      106,798 * 

Aon Corp.

    6,228      231,183   

Assurant Inc.

    2,579      89,491   

Berkshire Hathaway Inc., Class B Shares

    38,144      3,039,695 * 

Chubb Corp.

    7,527      376,425   

Cincinnati Financial Corp.

    3,752      97,064   

Genworth Financial Inc., Class A Shares

    11,407      149,090 * 

Hartford Financial Services Group Inc.

    10,291      227,740   

Lincoln National Corp.

    6,977      169,471   

Loews Corp.

    8,115      270,311   

Marsh & McLennan Cos. Inc.

    12,382      279,214   

MetLife Inc.

    18,902      713,740   

Progressive Corp.

    15,530      290,722   

Prudential Financial Inc.

    10,791      579,045   

Torchmark Corp.

    1,903      94,218   

Travelers Cos. Inc.

    11,349      558,938   

Unum Group

    7,713      167,372   

XL Group PLC

    7,948      127,248   
           

Total Insurance

         8,394,403   
           

Real Estate Investment Trusts (REITs) - 1.3%

      

Apartment Investment and Management Co., Class A Shares

    2,685      52,008   

AvalonBay Communities Inc.

    1,904      177,776   

Boston Properties Inc.

    3,196      228,003   

Equity Residential

    6,522      271,576   

HCP Inc.

    6,484      209,109   

Health Care REIT Inc.

    2,824      118,947   

Host Hotels & Resorts Inc.

    15,218      205,139   

Kimco Realty Corp.

    9,317      125,221   

Plum Creek Timber Co. Inc.

    3,737      129,039   

ProLogis

    11,067      112,109   

Public Storage Inc.

    3,127      274,894   

Simon Property Group Inc.

    6,767      546,435   

Ventas Inc.

    3,596      168,832   

Vornado Realty Trust

    3,643      265,757   
           

Total Real Estate Investment Trusts (REITs)

         2,884,845   
           

Real Estate Management & Development - 0.1%

      

CB Richard Ellis Group Inc., Class A Shares

    6,116      83,239 * 
           

Thrifts & Mortgage Finance - 0.1%

      

Hudson City Bancorp Inc.

    10,958      134,126   

People’s United Financial Inc.

    8,595      116,032   
           

Total Thrifts & Mortgage Finance

         250,158   
           

TOTAL FINANCIALS

         35,090,131   
           
HEALTH CARE - 11.7%      

Biotechnology - 1.4%

      

Amgen Inc.

    22,024      1,158,463  * 

Biogen Idec Inc.

    6,268      297,417 * 

Celgene Corp.

    10,623      539,861 * 

Cephalon Inc.

    1,743      98,915 * 

Genzyme Corp.

    6,234      316,500 * 

 

See Notes to Schedule of Investments.

 

5

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

Biotechnology - continued

      

Gilead Sciences Inc.

    20,619    $ 706,819 * 
           

Total Biotechnology

         3,117,975   
           

Health Care Equipment & Supplies - 2.0%

      

Baxter International Inc.

    13,786      560,263   

Becton, Dickinson & Co.

    5,367      362,917   

Boston Scientific Corp.

    35,129      203,748 * 

C.R. Bard Inc.

    2,176      168,705   

CareFusion Corp.

    4,059      92,139 * 

DENTSPLY International Inc.

    3,366      100,677   

Hospira Inc.

    3,817      219,287 * 

Intuitive Surgical Inc.

    914      288,477 * 

Medtronic Inc.

    25,340      919,082   

St. Jude Medical Inc.

    7,503      270,783 * 

Stryker Corp.

    6,454      323,087   

Thermo Fisher Scientific Inc.

    9,467      464,356 * 

Varian Medical Systems Inc.

    2,865      149,782 * 

Zimmer Holdings Inc.

    4,671      252,468 * 
           

Total Health Care Equipment & Supplies

         4,375,771   
           

Health Care Providers & Services - 2.1%

      

Aetna Inc.

    9,687      255,543   

AmerisourceBergen Corp.

    6,473      205,518   

Cardinal Health Inc.

    8,271      277,988   

CIGNA Corp.

    6,353      197,324   

Coventry Health Care Inc.

    3,376      59,688 * 

DaVita Inc.

    2,400      149,856 * 

Express Scripts Inc.

    12,431      584,506 * 

Humana Inc.

    3,894      177,839 * 

Laboratory Corporation of America Holdings

    2,383      179,559 * 

McKesson Corp.

    6,216      417,467   

Medco Health Solutions Inc.

    10,452      575,696 * 

Patterson Cos. Inc.

    2,154      61,454   

Quest Diagnostics Inc.

    3,466      172,503   

Tenet Healthcare Corp.

    9,910      43,009 * 

UnitedHealth Group Inc.

    26,056      739,990   

WellPoint Inc.

    9,814      480,199 * 
           

Total Health Care Providers & Services

         4,578,139   
           

Health Care Technology - 0.1%

      

Cerner Corp.

    1,568      118,995 * 
           

Life Sciences Tools & Services - 0.2%

      

Life Technologies Corp.

    4,221      199,442 * 

Millipore Corp.

    1,291      137,685 * 

PerkinElmer Inc.

    2,708      55,974   

Waters Corp.

    2,122      137,294 * 
           

Total Life Sciences Tools & Services

         530,395   
           

Pharmaceuticals - 5.9%

      

Abbott Laboratories

    35,695      1,669,812   

Allergan Inc.

    7,087      412,889   

Bristol-Myers Squibb Co.

    39,244      978,745   

Eli Lilly & Co.

    23,526      788,121   

Forest Laboratories Inc.

    6,981      191,489 * 

Johnson & Johnson

    63,553      3,753,440   

King Pharmaceuticals Inc.

    5,732      43,506 * 

Merck & Co. Inc.

    71,881      2,513,678   

Mylan Inc.

    7,244      123,438 * 

Pfizer Inc.

    185,864      2,650,421   

Watson Pharmaceuticals Inc.

    2,460      99,802 * 
           

Total Pharmaceuticals

         13,225,341   
           

TOTAL HEALTH CARE

         25,946,616   
           
INDUSTRIALS - 10.0%      

Aerospace & Defense - 2.1%

      

Boeing Co.

    17,543      1,100,823   

General Dynamics Corp.

    8,935      523,234   

Goodrich Corp.

    2,893      191,661   

 

See Notes to Schedule of Investments.

 

6

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

Aerospace & Defense - continued

      

Honeywell International Inc.

    17,609    $ 687,279   

L-3 Communications Holdings Inc.

    2,625      185,955   

Lockheed Martin Corp.

    7,138      531,781   

Northrop Grumman Corp.

    6,957      378,739   

Precision Castparts Corp.

    3,264      335,931   

Raytheon Co.

    8,748      423,316   

Rockwell Collins Inc.

    3,636      193,181   
           

Total Aerospace & Defense

         4,551,900   
           

Air Freight & Logistics - 1.0%

      

C.H. Robinson Worldwide Inc.

    3,817      212,454   

Expeditors International of Washington Inc.

    4,913      169,548   

FedEx Corp.

    7,242      507,737   

Ryder System Inc.

    1,223      49,201   

United Parcel Service Inc., Class B Shares

    22,816      1,298,002   
           

Total Air Freight & Logistics

         2,236,942   
           

Airlines - 0.1%

      

Southwest Airlines Co.

    17,051      189,436   
           

Building Products - 0.0%

      

Masco Corp.

    8,364      89,997   
           

Commercial Services & Supplies - 0.5%

      

Avery Dennison Corp.

    2,539      81,578   

Cintas Corp.

    3,039      72,845   

Iron Mountain Inc.

    4,170      93,658   

Pitney Bowes Inc.

    4,777      104,903   

R.R. Donnelley & Sons Co.

    4,775      78,167   

Republic Services Inc.

    7,484      222,499   

Stericycle Inc.

    1,967      128,996 * 

Waste Management Inc.

    11,155      349,040   
           

Total Commercial Services & Supplies

         1,131,686   
           

Construction & Engineering - 0.2%

      

Fluor Corp.

    4,143      176,077   

Jacobs Engineering Group Inc.

    2,875      104,765 * 

Quanta Services Inc.

    4,840      99,946 * 
           

Total Construction & Engineering

         380,788   
           

Electrical Equipment - 0.5%

      

Emerson Electric Co.

    17,385      759,551   

Rockwell Automation Inc.

    3,282      161,113   

Roper Industries Inc.

    2,162      120,985   
           

Total Electrical Equipment

         1,041,649   
           

Industrial Conglomerates - 2.8%

      

3M Co.

    16,303      1,287,774   

General Electric Co.

    238,812      3,443,669   

Textron Inc.

    6,332      107,454   

United Technologies Corp.

    21,614      1,402,965   
           

Total Industrial Conglomerates

         6,241,862   
           

Machinery - 1.8%

      

Caterpillar Inc.

    14,479      869,754   

Cummins Inc.

    4,640      302,203   

Danaher Corp.

    12,146      450,860   

Deere & Co.

    9,783      544,717   

Dover Corp.

    4,302      179,781   

Eaton Corp.

    3,860      252,598   

Flowserve Corp.

    1,295      109,816   

Illinois Tool Works Inc.

    8,876      366,401   

ITT Industries Inc.

    4,242      190,551   

PACCAR Inc.

    8,478      338,018   

Pall Corp.

    4,166      143,185   

Parker Hannifin Corp.

    3,708      205,646   

Snap-on Inc.

    1,332      54,492   
           

Total Machinery

         4,008,022   
           

Professional Services - 0.1%

      

Dun & Bradstreet Corp.

    1,162      77,993   

 

See Notes to Schedule of Investments.

 

7

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

Professional Services - continued

      

Equifax Inc.

    2,908    $ 81,599   

Robert Half International Inc.

    3,444      81,106   
           

Total Professional Services

         240,698   
           

Road & Rail - 0.8%

      

CSX Corp.

    8,939      443,643   

Norfolk Southern Corp.

    8,526      452,304   

Union Pacific Corp.

    11,629      808,332   
           

Total Road & Rail

         1,704,279   
           

Trading Companies & Distributors - 0.1%

      

Fastenal Co.

    3,032      152,176   

W. W. Grainger Inc.

    1,425      141,716   
           

Total Trading Companies & Distributors

         293,892   
           

TOTAL INDUSTRIALS

         22,111,151   
           
INFORMATION TECHNOLOGY - 18.2%      

Communications Equipment - 2.5%

      

Cisco Systems Inc.

    131,600      2,804,396 * 

Corning Inc.

    35,511      573,503   

Harris Corp.

    2,993      124,658   

JDS Uniphase Corp.

    5,124      50,420 * 

Juniper Networks Inc.

    12,168      277,674 * 

Motorola Inc.

    53,269      347,314 * 

QUALCOMM Inc.

    37,861      1,243,355   

Tellabs Inc.

    8,957      57,235   
           

Total Communications Equipment

         5,478,555   
           

Computers & Peripherals - 4.4%

      

Apple Inc.

    20,967      5,273,829 * 

Dell Inc.

    39,632      477,962 * 

EMC Corp.

    47,374      866,944 * 

Hewlett-Packard Co.

    54,009      2,337,510   

Lexmark International Inc., Class A Shares

    1,822      60,181 * 

NetApp Inc.

    7,890      294,376 * 

QLogic Corp.

    2,588      43,013 * 

SanDisk Corp.

    5,272      221,793 * 

Teradata Corp.

    3,928      119,725 * 

Western Digital Corp.

    5,264      158,762 * 
           

Total Computers & Peripherals

         9,854,095   
           

Electronic Equipment, Instruments & Components - 0.3%

      

Agilent Technologies Inc.

    8,085      229,857 * 

Amphenol Corp., Class A Shares

    4,008      157,434   

FLIR Systems Inc.

    3,566      103,735 * 

Jabil Circuit Inc.

    4,469      59,438   

Molex Inc.

    3,151      57,474   
           

Total Electronic Equipment, Instruments & Components

         607,938   
           

Internet Software & Services - 1.7%

      

Akamai Technologies Inc.

    4,002      162,361 * 

eBay Inc.

    26,242      514,606 * 

Google Inc., Class A Shares

    5,563      2,475,257 * 

Monster Worldwide Inc.

    2,791      32,515 * 

VeriSign Inc.

    4,202      111,563 * 

Yahoo! Inc.

    27,097      374,751 * 
           

Total Internet Software & Services

         3,671,053   
           

IT Services - 3.0%

      

Automatic Data Processing Inc.

    11,571      465,848   

Cognizant Technology Solutions Corp., Class A Shares

    6,966      348,718 * 

Computer Sciences Corp.

    3,535      159,959   

Fidelity National Information Services Inc.

    7,587      203,483   

Fiserv Inc.

    3,512      160,358 * 

International Business Machines Corp.

    29,502      3,642,907   

MasterCard Inc., Class A Shares

    2,244      447,745   

Paychex Inc.

    7,380      191,659   

SAIC Inc.

    6,750      112,995 * 

Total System Services Inc.

    4,558      61,989   

 

See Notes to Schedule of Investments.

 

8

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

IT Services - continued

      

Visa Inc., Class A Shares

    10,386    $ 734,810   

Western Union Co.

    15,480      230,807   
           

Total IT Services

         6,761,278   
           

Office Electronics - 0.1%

      

Xerox Corp.

    31,874      256,267   
           

Semiconductors & Semiconductor Equipment - 2.5%

      

Advanced Micro Devices Inc.

    13,194      96,580 * 

Altera Corp.

    6,959      172,653   

Analog Devices Inc.

    6,879      191,649   

Applied Materials Inc.

    31,033      373,017   

Broadcom Corp., Class A Shares

    9,940      327,722   

First Solar Inc.

    1,094      124,530 * 

Intel Corp.

    128,330      2,496,018   

KLA-Tencor Corp.

    3,935      109,708   

Linear Technology Corp.

    5,174      143,889   

LSI Corp.

    15,086      69,395 * 

MEMC Electronic Materials Inc.

    5,301      52,374 * 

Microchip Technology Inc.

    4,289      118,977   

Micron Technology Inc.

    19,890      168,866 * 

National Semiconductor Corp.

    5,513      74,205   

Novellus Systems Inc.

    2,214      56,147 * 

NVIDIA Corp.

    13,245      135,231 * 

Teradyne Inc.

    4,176      40,716 * 

Texas Instruments Inc.

    28,164      655,658   

Xilinx Inc.

    6,365      160,780   
           

Total Semiconductors & Semiconductor Equipment

         5,568,115   
           

Software - 3.7%

      

Adobe Systems Inc.

    12,261      324,058 * 

Autodesk Inc.

    5,363      130,643 * 

BMC Software Inc.

    4,201      145,481 * 

CA Inc.

    9,034      166,226   

Citrix Systems Inc.

    4,311      182,054 * 

Compuware Corp.

    5,162      41,193 * 

Electronic Arts Inc.

    7,527      108,389 * 

Intuit Inc.

    7,222      251,109 * 

McAfee Inc.

    3,591      110,315 * 

Microsoft Corp.

    175,821      4,045,641   

Novell Inc.

    8,019      45,548 * 

Oracle Corp.

    90,302      1,937,881   

Red Hat Inc.

    4,344      125,715 * 

Salesforce.com Inc.

    2,571      220,643 * 

Symantec Corp.

    18,596      258,112 * 
           

Total Software

         8,093,008   
           

TOTAL INFORMATION TECHNOLOGY

         40,290,309   
           
MATERIALS - 3.3%      

Chemicals - 1.8%

      

Air Products & Chemicals Inc.

    4,952      320,939   

Airgas Inc.

    1,910      118,802   

CF Industries Holdings Inc.

    1,616      102,535   

Dow Chemical Co.

    26,816      636,075   

E.I. du Pont de Nemours & Co.

    21,146      731,440   

Eastman Chemical Co.

    1,705      90,979   

Ecolab Inc.

    5,360      240,718   

FMC Corp.

    1,664      95,564   

International Flavors & Fragrances Inc.

    1,835      77,841   

Monsanto Co.

    12,574      581,170   

PPG Industries Inc.

    3,865      233,485   

Praxair Inc.

    7,072      537,401   

Sigma-Aldrich Corp.

    2,793      139,175   
           

Total Chemicals

         3,906,124   
           

Construction Materials - 0.1%

      

Vulcan Materials Co.

    2,950      129,299   
           

 

See Notes to Schedule of Investments.

 

9

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

    SHARES    VALUE  

Containers & Packaging - 0.2%

      

Ball Corp.

    2,122    $ 112,105   

Bemis Co. Inc.

    2,514      67,878   

Owens-Illinois Inc.

    3,783      100,060 * 

Pactiv Corp.

    3,056      85,110 * 

Sealed Air Corp.

    3,679      72,550   
           

Total Containers & Packaging

         437,703   
           

Metals & Mining - 1.0%

      

AK Steel Holding Corp.

    2,520      30,038   

Alcoa Inc.

    23,374      235,143   

Allegheny Technologies Inc.

    2,273      100,444   

Cliffs Natural Resources Inc.

    3,106      146,479   

Freeport-McMoRan Copper & Gold Inc., Class B Shares

    10,872      642,861   

Newmont Mining Corp.

    11,321      698,959   

Nucor Corp.

    7,246      277,377   

Titanium Metals Corp.

    1,968      34,617 * 

United States Steel Corp.

    3,277      126,328   
           

Total Metals & Mining

         2,292,246   
           

Paper & Forest Products - 0.2%

      

International Paper Co.

    10,127      229,174   

MeadWestvaco Corp.

    3,970      88,134   

Weyerhaeuser Co.

    4,886      171,987   
           

Total Paper & Forest Products

         489,295   
           

TOTAL MATERIALS

         7,254,667   
           
TELECOMMUNICATION SERVICES - 2.9%      

Diversified Telecommunication Services - 2.6%

      

AT&T Inc.

    136,158      3,293,662   

CenturyTel Inc.

    6,910      230,172   

Frontier Communications Corp.

    7,225      51,370   

Qwest Communications International Inc.

    34,495      181,099   

Verizon Communications Inc.

    65,289      1,829,398   

Windstream Corp.

    11,013      116,297   
           

Total Diversified Telecommunication Services

         5,701,998   
           

Wireless Telecommunication Services - 0.3%

      

American Tower Corp., Class A Shares

    9,292      413,494 * 

MetroPCS Communications Inc.

    6,055      49,590 * 

Sprint Nextel Corp.

    69,870      296,249 * 
           

Total Wireless Telecommunication Services

         759,333   
           

TOTAL TELECOMMUNICATION SERVICES

         6,461,331   
           
UTILITIES - 3.6%      

Electric Utilities - 1.9%

      

Allegheny Energy Inc.

    3,875      80,135   

American Electric Power Co. Inc.

    11,002      355,364   

Duke Energy Corp.

    30,043      480,688   

Edison International

    7,451      236,346   

Entergy Corp.

    4,349      311,475   

Exelon Corp.

    15,201      577,182   

FirstEnergy Corp.

    6,978      245,835   

NextEra Energy Inc.

    9,550      465,658   

Northeast Utilities

    4,039      102,914   

Pepco Holdings Inc.

    5,106      80,062   

Pinnacle West Capital Corp.

    2,506      91,118   

PPL Corp.

    8,687      216,741   

Progress Energy Inc.

    6,600      258,852   

Southern Co.

    18,972      631,388   
           

Total Electric Utilities

         4,133,758   
           

Gas Utilities - 0.2%

      

EQT Corp.

    3,289      118,864   

Nicor Inc.

    1,040      42,120   

ONEOK Inc.

    2,439      105,487   

Questar Corp.

    4,036      183,598   
           

Total Gas Utilities

         450,069   
           

 

See Notes to Schedule of Investments.

 

10

LEGG MASON BATTERYMARCH S&P 500 INDEX FUND

 

Schedule of investments (unaudited) (cont’d)    June 30, 2010

 

SECURITY

               SHARES    VALUE  

Independent Power Producers & Energy Traders - 0.2%

           

AES Corp.

           15,233    $ 140,753 * 

Constellation Energy Group Inc.

           4,654      150,092   

NRG Energy Inc.

           5,925      125,669 * 
                

Total Independent Power Producers & Energy Traders

              416,514   
                

Multi-Utilities - 1.3%

           

Ameren Corp.

           5,461      129,808   

CenterPoint Energy Inc.

           9,578      126,047   

CMS Energy Corp.

           5,271      77,220   

Consolidated Edison Inc.

           6,477      279,159   

Dominion Resources Inc.

           13,706      530,970   

DTE Energy Co.

           3,867      176,374   

Integrys Energy Group Inc.

           1,753      76,676   

NiSource Inc.

           6,374      92,423   

PG&E Corp.

           8,553      351,528   

Public Service Enterprise Group Inc.

           11,572      362,551   

SCANA Corp.

           2,609      93,298   

Sempra Energy

           5,677      265,627   

TECO Energy Inc.

           4,873      73,436   

Wisconsin Energy Corp.

           2,680      135,983   

Xcel Energy Inc.

           10,587      218,198   
                

Total Multi-Utilities

              2,989,298   
                

TOTAL UTILITIES

              7,989,639   
                

TOTAL INVESTMENTS BEFORE SHORT-TERM INVESTMENT

(Cost - $193,351,449)

      214,761,810   
                

SECURITY

    RATE     MATURITY
DATE		    FACE
AMOUNT		       
SHORT-TERM INVESTMENT - 0.8%           
Repurchase Agreement - 0.8%           

Interest in $400,005,000 joint tri-party repurchase agreement dated 6/30/10 with RBS Securities Inc.; Proceeds at maturity - $1,830,002; (Fully collateralized by various U.S. government agency obligations, 0.000% due 9/22/10 to 5/27/11; Market value - $1,866,616) (Cost - $1,830,000)

    0.030 %    7/1/10    $ 1,830,000      1,830,000   
                

TOTAL INVESTMENTS - 97.6%

(Cost - $195,181,449#)

              216,591,810   

Other Assets in Excess of Liabilities - 2.4%

              5,337,132   
                

TOTAL NET ASSETS - 100.0%

            $ 221,928,942   
                

 

* Non-income producing security.

 

# Aggregate cost for federal income tax purposes is substantially the same.

Abbreviation used in this schedule:

REIT - Real Estate Investment Trust

 

See Notes to Schedule of Investments.

 

11

Notes to Schedule of Investments (unaudited)

1. Organization and Significant Accounting Policies

Legg Mason Batterymarch S&P 500 Index Fund (the “Fund”) is a separate diversified investment series of Legg Mason Partners Equity Trust (the “Trust”). The Trust, a Maryland statutory trust, is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company.

The following are significant accounting policies consistently followed by the Fund and are in conformity with U.S. generally accepted accounting principles (“GAAP”).

(a) Investment Valuation. Equity securities for which market quotations are available are valued at the last reported sales price or official closing price on the primary market or exchange on which they trade. Debt securities are valued at the mean between the last quoted bid and asked prices provided by an independent pricing service, which are based on transactions in debt obligations, quotations from bond dealers, market transactions in comparable securities and various other relationships between securities. Futures contracts are valued daily at the settlement price established by the board of trade or exchange on which they are traded. When prices are not readily available, or are determined not to reflect fair value, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded, but before the Fund calculates its net asset value, the Fund values these securities at fair value as determined in accordance with procedures approved by the Fund’s Board of Trustees. Short-term obligations with maturities of 60 days or less are valued at amortized cost, which approximates fair value.

The Fund has adopted Financial Accounting Standards Board Codification Topic 820 (“ASC Topic 820”). ASC Topic 820 establishes a single definition of fair value, creates a three-tier hierarchy as a framework for measuring fair value based on inputs used to value the Fund’s investments, and requires additional disclosure about fair value. The hierarchy of inputs is summarized below.

 

  •  

Level 1 – quoted prices in active markets for identical investments

 

  •  

Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

 

  •  

Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The Fund uses valuation techniques to measure fair value that are consistent with the market approach and/or income approach, depending on the type of the security and the particular circumstance. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable securities. The income approach uses valuation techniques to convert future amounts of cash flow to a single present amount.

The following is a summary of the inputs used in valuing the Fund’s assets carried at fair value:

 

DESCRIPTION

    QUOTED PRICES
(LEVEL 1)		     OTHER SIGNIFICANT
OBSERVABLE  INPUTS
(LEVEL 2)		    SIGNIFICANT
UNOBSERVABLE
INPUTS
(LEVEL 3) 		   TOTAL  

Common stocks†

    $ 214,761,810        —      —      $ 214,761,810   

Short-term investment†

      —        $ 1,830,000    —        1,830,000   
                            

Total investments

    $ 214,761,810      $ 1,830,000    —      $ 216,591,810   
                            

Futures contracts

      (209,748 )      —      —        (209,748 ) 
                            

Total

    $ 214,552,062      $ 1,830,000    —      $ 216,382,062   
                            

 

† See Schedule of Investments for additional detailed categorizations.

 

12

Notes to Schedule of Investments (unaudited) (continued)

 

(b) Repurchase Agreements. The Fund may enter into repurchase agreements with institutions that its investment adviser has determined are creditworthy. Each repurchase agreement is recorded at cost. Under the terms of a typical repurchase agreement, a fund takes possession of an underlying debt obligation subject to an obligation of the seller to repurchase, and of the fund to resell, the obligation at an agreed-upon price and time, thereby determining the yield during a fund’s holding period. When entering into repurchase agreements, it is the Fund’s policy that its custodian or a third party custodian, acting on the Fund’s behalf, take possession of the underlying collateral securities, the market value of which, at all times, at least equals the principal amount of the repurchase transaction, including accrued interest. To the extent that any repurchase transaction maturity exceeds one business day, the value of the collateral is marked to market and measured against the value of the agreement in an effort to ensure the adequacy of the collateral. If the counterparty defaults, the Fund generally has the right to use the collateral to satisfy the terms of the repurchase transaction. However, if the market value of the collateral declines during the period in which the Fund seeks to assert its rights or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by the Fund may be delayed or limited.

(c) Futures Contracts. The Fund may use futures contracts to gain exposure to, or hedge against, changes in the value of equities, interest rates or foreign currencies. A futures contract represents a commitment for the future purchase or sale of an asset at a specified price on a specified date.

Upon entering into a futures contract, the Fund is required to deposit cash or cash equivalents with a broker in an amount equal to a certain percentage of the contract amount. This is known as the “initial margin” and subsequent payments (“variation margin”) are made or received by the Fund each day, depending on the daily fluctuation in the value of the contract. For certain futures, including foreign denominated futures, variation margin is not settled daily, but is recorded as a net variation margin payable or receivable. Futures contracts are valued daily at the settlement price established by the board of trade or exchange on which they are traded.

Futures contracts involve, to varying degrees, risk of loss. In addition, there is the risk that the Fund may not be able to enter into a closing transaction because of an illiquid secondary market.

(d) Security Transactions. Security transactions are accounted for on a trade date basis.

2. Investments

At June 30, 2010, the aggregate gross unrealized appreciation and depreciation of investments for federal income tax purposes were substantially as follows:

 

Gross unrealized appreciation

    $ 55,956,209   

Gross unrealized depreciation

      (34,545,848 ) 
        

Net unrealized appreciation

    $ 21,410,361   
        

At June 30, 2010, the Fund had the following open futures contracts:

 

     Number of
Contracts		    Expiration
Date		    Basis
Value		    Market
Value		    Unrealized
Gain		  
Contracts to Buy:               

S&P 500 Index

    35    9/10    $ 9,192,498    $ 8,982,750    $ (209,748 ) 

3. Derivative Instruments and Hedging Activities

Financial Accounting Standards Board Codification Topic 815 requires enhanced disclosure about an entity’s derivative and hedging activities.

The following is a summary of the Fund’s derivative instruments categorized by risk exposure at June 30, 2010.

 

13

Notes to Schedule of Investments (unaudited) (continued)

 

Primary Underlying Risk Disclosure

    Futures
Contracts
Unrealized
Depreciation		  

Equity contracts

    $ (209,748 ) 

During the period ended June 30, 2010, the volume of derivative activity for the Fund was as follows:

 

     Average Market
Value

Futures contracts (to buy)

    $ 52,196

The Fund has several credit related contingent features that if triggered would allow its derivatives counterparties to close out and demand payment or additional collateral to cover their exposure from the Fund. Credit related contingent features are established between the Fund and its derivatives counterparties to reduce the risk that the Fund will not fulfill its payment obligations to its counterparties. These triggering features include, but are not limited to, a percentage decrease in the Fund’s net assets and/or a percentage decrease in the Fund’s Net Asset Value or NAV. The contingent features are established within the Fund’s International Swap and Derivatives Association, Inc. master agreements which govern positions in swaps, over-the-counter options, and forward currency exchange contracts for each individual counterparty.

 

14

 

ITEM 2. CONTROLS AND PROCEDURES.

 

  (a) The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a- 3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934.

 

  (b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant’s last fiscal quarter that have materially affected, or are likely to materially affect the registrant’s internal control over financial reporting.

 

ITEM 3. EXHIBITS.

Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940, as amended, are attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Legg Mason Partners Equity Trust
By  

/S/    R. JAY GERKEN        

  R. Jay Gerken
  Chief Executive Officer
Date:   August 26, 2010

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By  

/S/    R. JAY GERKEN        

  R. Jay Gerken
  Chief Executive Officer
Date:   August 26, 2010
By  

/S/    KAPREL OZSOLAK        

  Kaprel Ozsolak
  Chief Financial Officer
Date:   August 26, 2010