- Make pesto by pulsing it ingredients in a food processor until well blended. Add a bit more oil if you find the pesto too thick. Or, conversely, add a bit more basil or walnuts, if pesto is too thin. Transfer pesto to a bowl, cover and refrigerate until needed.
- In a large bowl, or in the bowl of a stand mixer fitted with a dough hook, combine the water, yeast and sugar. Let mixture stand five minutes to dissolve the yeast.
- Mix in the 1 Tbsp olive oil. If using a stand mixer, add 1 1/3 cups of the flour and salt and mix on medium speed until the dough is smooth and pulls away from the sides of the bowl. If dough is still quite sticky, mix in some or all of the remaining 1/3 cup of flour. Mix and knead the dough for another five minutes. If mixing the dough by hand, start by slowly add one cup of the flour, working it into the yeast/water mixture with a spoon until the dough loosely clumps together. Lightly dust a clean work surface with the remaining flour. Gather the dough, scraping the sides of the bowl if necessary, and set it on the counter. Dab it lightly in the flour to coat it, and then knead for six to eight minutes, until the dough is smooth, but still slightly sticky.
- Lightly grease a large, deep bowl with olive oil. Place the kneaded dough in the bowl, cover with plastic wrap, and allow to rise at warm room temperature until doubled in size, about 60 to 75 minutes.
- Line a baking sheet with parchment paper. Lightly flour a work surface and set the dough on it. Press the dough flat. Now, with a lightly floured rolling pin, roll dough into 14” x 10” rectangle. Spread the top of the dough with pesto, leaving 1” or so of clean dough around the edges.
- Roll the dough, as tightly as you can, into long cylinder. Now roll up that cylinder into a round loaf that kind looks like a giant cinnamon bun or snail shell (see Note).
- Set bread on the baking sheet. Lightly brush the top of it with olive oil; sprinkle with coarse salt and pepper. Set a large bowl over the loaf to cover it. Let loaf rise at warm room temperature until doubled, about 60 to 75 minutes.
- Set an oven rack in the middle of the oven, then preheat the oven to 375˚F. Bake the bread for 20 to 22 minutes, or until puffed and rich golden.
Note: See step-by-step photos on how to form this bread here