Place first 6 ingredients in a blender; process until smooth.
Heat oil in a large nonstick skillet over medium-high heat. Add onion and sugar; cook 8 minutes or until onion is browned, stirring occasionally.
Cut bread loaf in half horizontally; spread pepper mixture evenly over cut sides of bread. Layer turkey, fontina cheese, onion, and watercress over bottom half of loaf; top with remaining loaf half. Cut loaf into 4 pieces.
Calories 416 (25% from fat); Fat 11.5g (sat 4.4g, mono 4.5g, poly 1.6g; Protein 37.5g; Carb 39.9g; Fiber 3.6g; Chol 90mg; Iron 3.4mg; Sodium 572mg; Calc 217mg
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