Major U.S. airlines saw higher traffic and flights that were often full in July, reflecting improved travel demand as the industry recovers from a downturn, according to data released by the airlines over the last week.

Many of the nine largest airlines also reported increases in the number of seats for sale. But load factors, which measure how full an airplane is, hovered between 84.9 percent and 88.6 percent.

Delta Air Lines , the world's largest carrier, reported a traffic increase of 0.5 percent in July from a year ago, while its capacity fell 0.3 percent.

AMR Corp's American Airlines said its traffic grew by 2.7 percent on a capacity increase of 3.1 percent.

It seems the same story of minimal volume growth but strong pricing continued in July, said Morningstar equity analyst Basili Alukos. As long as fuel prices stay around $80 per barrel, I think the industry should continue to remain profitable.

The airline industry is clawing its way out of a downturn that eroded travel demand in 2009. Sweeping capacity cuts in 2008 helped the carriers survive that downturn, but some airlines are slowing expanding again.

US Airways Group , whose traffic grew 1.1 percent, also reported a 2 percent increase in capacity.

This improvement was largely driven by continued year-over-year strength in business demand and yield, US Airways President Scott Kirby said in a statement.

Airline shares were broadly weaker on Tuesday with the Arca airline index <.XAL> off 1.4 percent.

(Reporting by Kyle Peterson; Editing by Richard Chang)

American Airlines