American Airlines (AAL) stock is taking off in intraday trading on Thursday, soaring 10.45% as positive news sweeps through the airline sector. The dramatic upswing comes on the heels of industry peer Delta Air Lines' strong earnings report and an analyst upgrade for American Airlines itself.

Delta Air Lines set a bullish tone for the airline industry by beating Wall Street's expectations for the second quarter. The carrier reported adjusted earnings per share of $2.10 on revenue of $16.7 billion, surpassing analyst estimates. More importantly, Delta restored its full-year guidance, signaling increased confidence in the travel demand outlook. This performance has sparked optimism about the overall health of the travel sector, lifting sentiment for other airlines including American.

Adding to the tailwind for American Airlines, Barclays raised its price target for the company to $12 from $11. This upgrade suggests increased confidence in American's potential, despite the challenges faced by the airline industry in recent months. The combination of sector-wide optimism and company-specific positive news is fueling the stock's impressive gain.

While the airline sector has experienced turbulence this year, with American Airlines' stock down significantly year-to-date prior to today's surge, this latest movement indicates a potential shift in investor sentiment. As the industry navigates through economic uncertainties and fluctuating travel demand, American Airlines' rally may signal growing optimism about its ability to overcome these challenges and capitalize on the summer travel season.