The major domestic equity indexes closed higher on Friday as investors shrugged off concerns about global trade tensions, but trading volume was relatively light ahead of a busy week of central bank meetings.

The S&P 500 index remained in positive territory during the afternoon after reversing losses in the early afternoon with its largest gains coming from the health care and consumer staples sectors.

Investors appeared to put aside worries about U.S. relations with its largest trading partners. G7 major nations started what was expected to be a tense meeting after Trump’s decision to impose tariffs on steel and aluminum imports from Canada, the European Union and Mexico.

However, there was hesitation on the Street ahead of U.S. and European central bank meetings and a North Korea-U.S. summit set for June 12.

For the week, the S&P rose 1.62 percent while the Dow added 2.76 percent and the Nasdaq gained 1.21 percent.

The consumer staples index was the largest percentage gainer of the S&P’s 11 major sectors, with a 1.3 percent advance. Its biggest drivers were Procter & Gamble which continued its rally from the previous day, rising 1.9 percent, and Philip Morris (PM.N), which rose 2.6 percent after it announced a 6.5 percent dividend hike.

Monster Beverage, another staples company, rose 4.7 percent after the energy drink maker said it was “highly likely” it would raise prices later in the year.

The Healthcare index was the S&P’s best supporter with a 0.7 percent gain and its largest driver was Allergan, which rose 4.3 percent.

The technology sector was barely positive with a 0.03 percent gain. Dragging on the sector was Apple and its suppliers, which were down following a report that the iPhone maker was planning to produce fewer phones this year. Apple was last down 1 percent.

In the quietest trading day since May 25, approximately 6.05 billion shares changed hands on the major domestic equity exchanges, as compared to the 6.6 billion share average over the past 20 trading days.

Inflation Front and Center

Inflation has been tame for years, but rising prices and wages are now showing signs of squeezing corporate profit margins, leading lower share prices for companies whose results are deteriorating.

Investors have long focused on rewarding companies that can multiply sales in a relatively slow-growth economy like Netflix and Amazon, but they are now paying more attention to figures further down the income statement like expenses and pre-tax margins.

So far this year companies with high operating leverage, which allows rising revenue to increase earnings, while costs stay low have seen their share prices rise 15 percent, exceeding their brethren by nearly 6 percentage points, according to Goldman Sachs.

Investors have also been rewarding companies with high and stable gross profit margins, according to the data. However, a shift in focus may now be occurring as the impact of corporate tax cuts encourages more spending, along with 10 years of ultra-low interest rates that have stimulated economic growth and finally begun to push up prices and wages.

Large corporate tax cuts enacted last year raised corporate profits, making most companies’ results look better by after-tax measures, but the benefit of the tax cuts also enabled companies to spend on talent and market share, sometimes raising expenses.

The other driver is an ever-increasing focus on pre-tax margins with regard to inflation as industrial companies are forced to pay more for raw materials and companies dependent on consumer demand pay more in wages.

Investors, he said, “could easily lose a lot of equity in stocks they want to hold on to because of (their dividends).”

Campbell Soup has seen its share price fall 30 percent so far this year over concerns that packaged goods companies are struggling to pass on higher costs to consumers through powerful distributors like Walmart. In its most recent quarterly earnings, the canned-soup company reported “higher supply chain costs and cost inflation including higher transportation and logistics costs.”

Another example is Stanley Black & Decker whose stock is off 14 percent year-to-date despite exceeding Wall Street earnings estimates. The power-tool manufacturer’s chief financial officer, Donald Allan, said in April that steel, batteries and base metals prices were going to take more of a bite out of earnings than they had warned though they hope to offset those impacts by adjusting prices.

Airline stocks also sank this year with crude oil prices up about 9.0 percent this year, pushing up jet fuel costs. Airline stocks tracked by Thomson Reuters Corp are down more than seven percent this year.

By contrast, companies who have managed to widen profit margins such as Zoetis, which manufacturers medicines for animals, Calvin Klein apparel maker PVH and agricultural product manufacturer Monsanto, have been rewarded with higher share prices this year.

The Labor Department reported recently that its headline consumer price inflation was 2.5 percent year-on-year in May and hourly earnings for private sector employees were up 2.7 percent from a year-ago.

In its May “Beige Book” on business conditions, the Federal Reserve reported moderate price rises in most regions of the nation and noted rising materials costs in some districts that are putting pressure on transportation, construction and manufacturing.

Tough talk on tariffs on imported goods by Trump, and potential retaliation by China and other countries, may also push up consumer prices up even further.

The strong dollar may restrain imported inflation, but a rising dollar typically does more to curtail exports by making them more expensive than it does to tamp down inflation by cheapening imports, according to 2015 Boston Fed research.