U.S. stocks and the euro pared losses amid speculation that European leaders were nearing an agreement on plans to halt contagion from the debt crisis.

The Standard & Poor’s 500 Index slipped 0.2 percent to 1,329.01 at 4 p.m. in New York after earlier slumping as much as 1.4 percent. The euro slipped less than 0.2 percent to $1.2447 after earlier dropping as much as 0.5 percent.

Italy and Spain may get short-term relief to ease financing pressure, Xinhua reported, citing a European Union source at the summit in Brussels. German Chancellor Angela Merkel canceled a press briefing at the summit and her spokesman said talks on a growth accord were ongoing.

To contact the reporter on this story: Michael P. Regan in New York at mregan12@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net