Airline stock trade sideways with Continental, US Airways By Christopher Hinton, MarketWatch NEW YORK (MarketWatch) -- More people are flying overseas this year as the global economy rebounds from recession, growing revenue and profit among the country's largest airlines. On Monday, the International Air Transport Association said premium ticket sales, which include business- and first-class travel, increased 7.6% in the recent quarter from the same period last year. Economy volumes rose 7.4%. Corporate demand, particularly for travel to the Far East, helped drive the growth. "Of course both travel classes have been rebounding from the low levels of 2009, so there has been the usual post-recession surge in pent-up travel demand," IATA said in a statement. Although premium passengers account for just 10% of international fliers, they generate 30% of international revenue, the trade group said. At last check, the NYSE Arca Airline Index (XAL 36.62, -0.10, -0.27%) declined less than 1% to 36.53 points with eight of its 13 components trading up. In the last 52 weeks, the sector benchmark has moved in a range of 40.89 to 15.92 points. Legacy carrier shares rose fractionally, with Continental Airlines (CAL 20.79, +0.14, +0.68%) up 11 cents to $20.76 and US Airways (LCC 7.08, -0.01, -0.14%) added a nickel to $7.14, while American parent AMR Corp. (AMR 7.25, +0.09, +1.27%) up 2% to $7.33. Trading down, U.S.-listed shares of Gol Linhas (GOL 12.47, -0.18, -1.42%) fell 1.8% to $12.42, Tam Sa (TAM 15.20, -0.45, -2.88%) declined 4% to $15.18 and Ryanair Holdings (RYAAY 23.58, -1.14, -4.61%) dropped 4.6% to $23.59. Leisure travel languishes as business fliers compete for fewer seats Corporate customers have returned to flying more quickly than at first anticipated, though it's still at a relatively sluggish pace. Nonetheless, it's driving up ticket prices rapidly as airlines remain cautious over adding new capacity, leaving fewer seats to purchase. Read more about the rapid rise in airfare. In March, IATA slashed its projected 2010 loss for the industry to $2.8 billion, from a prior expected loss of $5.6 billion. Compared to the fourth quarter and adjusted for normal seasonality, IATA said international premium volumes grew 25% in the first quarter, with economy-seat sales up 10%. The impact of flight disruptions due to the erupting volcano in Iceland is estimated to have lowered overall numbers by 4%. Read more about the volcanic ash and recent disruptions. Growth in both seat classes is being driven by business travel as world trade rose sharply, but leisure travel has languished and isn't likely to recover quickly, the group said. "Consumer confidence has not recovered in the same way as business confidence," the IATA said. "Higher levels of unemployment and consumer debt have led to little improvement since the mid-2009 rebound."

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