Canada’s largest banks, utilities and consumer staples are expected to remain relatively insulated from steep U.S. tariffs following the breakdown of bilateral trade talks, analysts said on Monday.
The United States imposed a 50% tariff on Canadian imports, threatening roughly $780 billion in annual two-way trade. Sectors most exposed include aluminum, auto parts and energy, where cross-border supply chains are deeply integrated. Automakers such as Magna International face elevated risk, as auto parts may cross the border up to eight times before final assembly. Canada also supplies about 60% of U.S. crude oil imports, making energy a key vulnerability.
Analysts at Morgan Stanley suggested aluminum tariffs could be reduced from 50% to 25%, though energy disruption remains a significant tail risk.
Among financials, Royal Bank of Canada (RY) trades at C$282.62, up 23.1% year-to-date, with a price-to-earnings ratio of 18.2x and a dividend yield of 2.5%. Toronto-Dominion Bank (TD) is at C$161.47, up 27.5% this year, with a 18.6x P/E and 2.8% yield. Bank of Montreal (BMO) has gained 38.0% in 2026 to C$238.41, trading at 18.1x earnings with a 2.8% dividend.
In utilities, Fortis (FTS) has a market capitalization of C$38.5 billion and has increased its dividend for 60 consecutive years. The stock is up 8.6% year-to-date at C$76.52, yielding 3.4%. Emera (EMA) is valued at C$21.2 billion, up 5.2% in 2026, with a 4.2% dividend yield.
Loblaw Companies (L), a major consumer staples player, has underperformed with a 2.0% year-to-date decline to C$61.47, a market cap of C$69.8 billion, and a 1.0% yield. Its low beta of 0.38 reflects relatively muted volatility.
Energy names such as Suncor Energy (SU) have outperformed with a 56.9% gain to C$93.15 and a 2.5% yield, but remain classified as high tariff exposure due to U.S. oil import reliance.
