Add yeast, water, and 1 teaspoon sugar to the bowl of a stand mixer and stir. Let sit for 5-10 minutes, or until foamy.
Add in melted butter, sugar, milk, eggs, and salt and mix on low speed.
Add 2 cups flour and mix in.
Continue adding 1/4 cup of flour at a time until the dough comes together. You may not need to use all of the flour. The dough should be elastic but should pull away from the sides of the bowl. If you pinch it it should feel slightly sticky but shouldn't come off on your fingers.
Knead on medium speed for 5 minutes, until the dough forms a smooth ball.
Cover and let the dough rise in a warm place until doubled, about 1 hour.
On a lightly floured surface, roll out the dough into a 12x16” rectangle.
Using an offset spatula, spread the Nutella evenly over the dough, leaving a small border around the edges.
Roll the dough into a tight log and pinch the seam.
Cut in half lengthwise.
Transfer to a baking sheet.
Secure the two pieces of dough together at the top by pinching the dough pieces together.
Using a sharp knife, slice through half the depth of the dough along the length of each roll.
Twist the dough twice to form a braid, then secure at the bottom by pinching the dough together and tucking the end underneath the bread.
Cover and let rise for 30 minutes.
Toward the end of the rising time, preheat oven to 300˚F.
Brush the dough with with egg and sprinkle hazelnuts, if using.
Bake for 45-55 minutes, or until a thermometer inserted into the center of the bread reaches 190˚F. If the crust is browning too quickly, tent with aluminum foil.
Remove from oven and allow to cool before slicing and serving.
Video
Notes
Rapid rise yeast: An equal amount of instant yeast can be substituted for the rapid rise yeast.
Water: It's important the water be about 115F. If the water is too hot, it can kill the yeast.
Butter: I use salted butter in this recipe.
All-purpose flour: It's important to only use enough from to make a slightly sticky dough. Using too much flour can give you dry, heavy, or dense bread.
Nutella: You can make your own Nutella spread with this recipe.
You can also use a 9x5-inch loaf pan to bake the bread.