Nov 3 (Reuters) - BMO Capital Markets downgraded clothing retailers Reitmans Ltd and Lululemon Athletica to "underperform" from "market perform," and said the companies' margins will be hit by their exposure to a weak Canadian dollar amid a slowdown in the economy.

Reitmans and Lululemon import more than 80 percent of their goods in U.S. dollars, while the Canadian dollar has weakened 18 percent this year, analyst Adam Clark said in a note to clients.

Clark also believes "there is an increasing probability that Canada will begin to go through a recession in the next several months."

The analyst cut his price target on Reitmans' shares to C$11.50 from C$17.00, while the price target on Nasdaq-listed shares of Lululemon was slashed to $10 from $26.

Shares of Reitmans were trading up 75 Canadian cents at C$13 Monday on the Toronto Stock Exchange, while Lululemon's stock was down $1.50 at $12.67 on Nasdaq. (Reporting by Anand Basu in Bangalore; Editing by Pratish Narayanan)