Thanks to disappointing payroll figures in the U.S. and Canada, where 54,500 jobs were actually lost in March, Friday is shaping up to be an ugly day for North American markets.
Executives that are reliant on the health of the Canadian consumer must have collectively gasped when this morningâs number hit. Some of the higher profile companies that face a decline in business should the Canadian economy go into a slump include Loblaw (TSX: L), Canadian Tire (TSX: CTC.A), Empire (TSX: EMP.A), CIBC (TSX:CM,NYSE:CM) and Target (NYSE: TGT).Â
For Loblaw, Canadian Tire, and Empire (owner of Sobeyâs as well as Empire Theatres) the impact that a slower economy will have on their business is clear. If Canadians are losing jobs, or even in fear of losing their job, they arenât going to spend money on anything except the bare necessities. Steak turns into hamburger and all that beat up old lawn mower in the shed suddenly needs is an oil change and itâll be good as new.
CIBC has become almost exclusively a Canadian retail bank and therefore, relative to its Big 5 peers is most exposed to the health of the Canadian consumer. And Target of course isnât Canadian, but has spent big on expanding to this country and is reliant on success here to fuel the companyâs future growth.
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Fool contributor Iain Butler does not own shares in any of the companies mentioned at this time. The Motley Fool has no positions in the stocks mentioned above.
