General Motors Co posted a 5 percent gain in July U.S. sales on Tuesday which it said underscored evidence of progress in the year since its emergence from a U.S. government-funded bankruptcy.

Sales of GM's four remaining brands -- Chevrolet, Cadillac, GMC and Buick -- were up almost 25 percent from a year earlier and the automaker said retail sales on that basis were up 18 percent in the year to date.

But including the brands GM dropped in its restructuring -- Pontiac, Saab, Saturn and Hummer -- sales to U.S. consumers in July were down 3.8 percent from a year earlier.

GM was the first of the major automakers to report July sales results for the U.S. market.

Analysts expect the industrywide results to show a slow but sustained recovery in consumer demand in one of the first economic indicators for the third quarter.

The GM results were in focus in part because they are expected to represent the last monthly sales update from the top-selling U.S. automaker before it files for a stock offering. The IPO is expected to reduce the U.S. government's GM ownership stake of 61 percent.

GM said it was keeping its forecast for full-year industrywide U.S. auto sales unchanged at 11.5 million to 12 million vehicles and said its sales incentives were in line with the industry average.

From our perspective, we see little risk of (a) double dip, absent some external shock, said Don Johnson, GM's head of U.S. sales.

Industrywide auto sales are expected to top the 1 million vehicle mark in July, a single-digit increase from both the previous month and the same month in 2009 when sales were lifted by the introduction of the government's cash-for-clunkers sales incentives.

Analysts surveyed by Reuters expect industry-wide sales of 11.4 million vehicles on an annualized basis in July. That would be up from near 11.2 million a year earlier.

The high end of the range of forecasts put industry sales for July closer to 12 million vehicles, which would be the highest sales result since August 2009.

Ford Motor Co and Nissan Motor Co <7201.T> are seen posting double-digit gains, industry tracking firm forecast.

Edmunds sees single-digit sales gains for Chrysler and Honda Motor Co <7267.T>. Toyota Motor Corp <7203.T>, hit by a series of damaging safety recalls early this year, could post a decline of 5 percent, Edmunds said.

Toyota was also one of the automakers that benefited most from the boom in sales of more fuel-efficient vehicles a year earlier, giving it a tougher comparison in year-on-year terms.

Industrywide U.S. auto sales have been in a gradual recovery since the last quarter of 2009, moving from a sales rate of 10.7 million in that period to 11 million in the first quarter and then 11.3 million in the second quarter.

But the pace of the industry's recovery has been slow and uneven, with demand for big-ticket items such as cars remaining far below the pre-recession levels.

As recently as 2007, automakers sold more than 16 million vehicles in the U.S. market, which was overtaken by China as the world's largest in 2009.

(Reporting by Soyoung Kim, writing by Kevin Krolicki, editing by Matthew Lewis)