European stocks edged higher Tuesday, despite disappointing economic data from Germany, as the world's equity markets continue to grind higher following last week's U.S. presidential elections.

Benchmark indices were mixed, however, in the first hour of trading, with Britain's FTSE 100 index adding around 50 points on the back of solid gains for basic material and financial stocks, while France's CAC-40 edged 4 points higher to 4519. Germany's DAX, weighed down by profit-taking in index heavyweights Deutsche Bank (DB) and Commerzbank CRZBY, fell around 20 points from Monday's close by 10:00 GMT.  

European government bonds saw a pause in the relentless rise in yields Tuesday as traders bid up sovereign debt following slower-than-expect growth in the region's biggest economy. 

Germany's official statistics office, Destatis, said Tuesday domestic GDP expanded by 0.2% in the three months ending in September, a slower pace of growth than the 0.4% advance recorded in Q2 and and analysts' forecasts of 0.3%.  

Destatis said a slowdown in foreign trade was the main downside contributor, but noted that domestic demand remained relatively resilient. Year-on-year, Destatis said, the economy has grown by 1.7%.

Benchmark 10-year bund yields fell 4 basis points to 0.3% while Italy's 10-year government bond yields traded back under 2% after rising to as high as 2.2% in Monday's trading.

Vodafone Group Plc (VOD) was a notable upside mover at the start of trading, with its shares rising 1.5% to 207.4 pence each after the group posted a first half operating loss after taking a €5 billion writedown on its key business in India, but reported better-than-expected core earnings as markets in Europe improved.

Earnings before interest, tax, depreciation and amortization, however, came in at €7.9 billion, down 1.7% from the same period last year on a reported basis but marginally ahead of analysts's forecasts of €7.8 billion and up 4.3% on an organic, or constant-currency basis.

Away from equities, the U.S. dollar reversed some of its recent gains to trade at 99.50 against a basket of global currencies, down from briefly trading at a 52-week high of 100.2 early Monday.

The move is notable in the context of developments in China, where the country's central bank set the trading band of its currency, the yuan, at 6.8495 before allowing it to trade a 6.86, the lowest level since 2008.

The pause in the U.S. dollar's advance did little for the pound, however, which fell 0.55% to trade at 1.2450 against the greenback after Britain's Office for National Statistics said consumer prices accelerated at a slower-than-expected pace last month.

Consumer prices for October rose 0.9% on the year, the ONS said, down from a 1.1% pace in September and slower than the 1% forecast by economists. 

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