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16:45 - Valverde moves into the red jersey, 18 seconds clear of team-mate Intxausti. Rodriguez is third at 19 seconds, Froome fourth at 20 and Contador fifth at 24.
16:40 - Confirmation of the top twelve riders: 1. Valverde, 2. Rodriguez, 3. Froome, 4. Contador, 5. Dani Moreno (+6), 6. Mollema, 7. Capecchi, 8. Intxausti, 9. Talansky, 10. Gesink, 11. Roche, 11. Anton.
16:35 - Initially, it looked like the victory was given to Rodriguez - it was his name up on the board above the finish.
0km - The win is awarded to Valverde! He came from behind and surprised Rodriguez right at the end. He will be the new red jersey tonight.
0km - We know Froome was third and Contador fourth - but still waiting for confirmation on the winner. That was close!
0km - Rodriguez leads out the sprint but it looks like he's pipped by Valverde over the line! Photo finish!!
1km - Remember, the bonus seconds are vital at the finish - 12 for the winner. Contador puts in another huge dig on the flat. Provided he finishes in the top three, Valverde should be in red tonight.
1.5km - Contador is on the back of the four leaders now, with Valverde taking the lead ahead of Froome and Rodriguez.
2km - Froome doesn't have the kick today. He is hanging in there. Contador is trying to put him under big pressure with these attacks. But the road now levels out towards the finish. One of these four will win.
2.5km - Yet another attack from Contador! He surges past Anton, taking Valverde and Rodriguez with him. Froome struggles back on...
2.8km - Now Roche and Anton come to the front as the big guns take a breather.
3km - Another big attack from Contador! Once again, only Rodriguez, Valverde and Froome can follow. Anton is there too as it comes back together again. Fascinating stuff.
3.2km - The leading group is now about 15-strong now. Both Rabobank climbers are there - Gesink and Mollema. And Andrew Talansky of Garmin.
3.5km - The pace slows after that Contador burst and the four leaders are re-joined by a cluster of riders, including Uran and Anton.
4km - Now Contador attacks! Froome is dropped! But the Briton manages to fight back on. Still the big four out in front.
4.5km - Four leaders now: Contador, Froome, Valverde and Rodriguez. A few are in pursuit, including Igor Anton.
5km - Attack by Valverde! Contador reacts, as does Rodriguez and Froome.
5km - Froome has Colombian pair Henao and Uran in support. Juan Jose Cobo is suffering off the back now. Ten Dam still sets the fast pace on the front, with Valverde on his wheel.
5.5km - Navarro and Ten Dam look to be on the front for Saxo and Rabobank.
5.5km - Red jersey Jonathan Castroviejo has already been dropped by the main group. He's been kept company by Denis Menchov.
6km - Contador, Froome and Katusha pair Rodriguez and Moreno are near the front. Roche is there too. No sign of Euskaltel yet.
6.5km - Saxo Tinkoff are taking up the pace setting, with Contador in second with Froome in his wheel. Terpstra is caught and passed.
7km - We're onto the foot of the Cat.1 Alto de Arrate - 5.5km at 7.8%. It's Niki Terpstra of Quick Step who has the first dig.
8km - The peloton is really strung out - like a snake.
9km - The break sits up. Game on! Only Markel Irizar, a proud Basque, is resisting - but the RadioShacl man finally calls it a day.
10km - The leading group is down to just six now. The whole of Sky is on the front now.
11km - Philippe Gilbert has a dog on the front - but it's all in vain. The pack is just 18 seconds behind now, with Sky taking up the work.
12km - It's getting fairly nervy and tense now for the riders in the peloton, which is being dragged along by the world time trial champion Tony Martin and Ian Stannard, the British national champion.
14km - The eight leaders only have 37 seconds now. They won't make it to the finish line, that's for sure.
18km - Andrey Zeits has decided to up the tempo on a slight rise in gradient. The Astana rider provokes a reponse from Gilbert. Back in the peloton, it's the turn of Omega Pharma Quick Step and Saxo Bank to come to the front.
19km - Now Team Sky and Rabobank come to the front of the peloton to take up the pace. The gap is down to 1:35.
20km - Dominique Rollin breaks away to take the points - and six bonus seconds - at the first intermediate sprint at Zaldivar. Crazily, there is still another intermediate sprint before the finish.
23km - The gap is down to two minutes now. Things are starting to get rather active. It will be interesting to see what happens at the finish - whether the main favourites keep to themselves or if one of the big names has a big dig. Surely Euskaltel rider will have a pop - they have no one in the break and this is the only stage that finishes in the Basque region this year.
27km - The blue jerseys and green helmets of Movistar still ever-present on the front of the chasing pack as they pass through a town with narrow roads and some hefty road furniture. The gap is 2:22.
30km - Those three points increase Ligthart's tally to 11 KOM points. Gilbert is currently second in the standings on six points. While the current polka dot jersey Javier Chacon is down on three points. With 15 points available for the winner on the next climb, Ligthart is far from assured the jersey yet.
32km - The peloton pass over the summit 2:37 down on the leaders.
35km - Once again, Pim Ligthart takes maximum points at the top of the climb. The Duchman passes over the Cat.3 Puerto de Campazar ahead of Nico Sijmens and Philippe Gilbert.
37km - We're onto the Cat.3 Puerto de Campazar - a 5.7km climb with an average gradient of 4.8%.
38km - We're approaching the penultimate climb of the day. The eight-man break is once again three minutes up the road as the pace slackens a little. Rabobank's Stef Clement drops back to get some water bottles for his team-mates. It will be interesting to see how Dutch pair Robert Gesink and Bauke Mollema do today (and in the race in general) after their disappointing Tour.
42km - The whole Movistar team is driving the pace on the front of the peloton, with both Cobo and Valverde looking very serene.
45km - The lead is tumbling fast now: 2:20 as the peloton roars along this long flat section. Still two more climbs today - including the Cat.1 summit finish.
50km - The eight leaders are taking on water from the neutral water motorbike. Both Lithgart and Carrasco pour a bottle over their heads. It's that hot out there today.
55km - Movistar combine on the front of the peloton to reduce the gap to 3:20. Even red jersey Janathan Castroviejo is lending a hand. He knows that he's merely keeping the leader's jersey warm for one of the main contenders - perhaps even Juan Jose Cobo or Alejandro Valverde.
60km - The gap is down to 3:40 for the leaders.
65km - Yesterday, Alberto Contador took two bonus seconds at the second intermediate sprint. The Saxo Bank rider has named two fellow Spaniards as the favourites for today: "Joaquim Rodriguez and Igor Anton will be the ones to watch and we will see who will succeed. The stage won see large time splits and I don't believe anyone will lose a lot of time."
70km - The riders pass though the feeding zone. It's going to be a rather hot lunch: the temperature is up to 38 degrees now.
75km - Speaking at the start of today's stage, Johan Bruyneel confirmed that RadioShack Nissan will not fold at the end of the season: "My team will continue into 2013 with the same structure, staff and riders," said the underfire directeur sportif.
80km - The average speed of the second hour of racing was up to 40.5 km/h. The gap back to the pack is still just about four minutes.
88km - The lead of the eight escapees is now 4:20. A reminder of their names: Sergio Carrasco(Andalucia), Dominique Rollin (FDJ-BigMat), Philippe Gilbert (BMC), Nico Sijmens (Cofidis), Markel Irizar (RadioShack), Andrey Zeits (Astana), Pim Ligthart (Vacansoleil-DCM) and Christophe Riblon (Ag2R-La Mondiale).
90km - Order over the Cat.3 Puerto de Vitoria: 1. Ligthart (3pts), 2. Gilbert (2pts), 3. Zeits (1pt). So, the top three go over in exactly the same order as over the first climb of the day, and Vacansoleil's Ligthart consolidates his lead at the top of the king of the mountains standings. The current polka dot jersey is Javier Chacon (Caja Rural) who took the 3pts over yesterday's solitary climb.
94km - The leaders are onto the second climb of the day, the Cat.3 Puerto de Vitoria (6.7km at 3.2%). The gap is up to four minutes now.
95km - Last year's runner-up, Chris Froome, shares a similar view to Rodriguez on today's stage: "The important things is to not use up too much energy too soon. It's an important stage but no one will lose many minutes. The margins will be small," he said.
100km - The lead of the eight-man Gilbert group is 3:10 over the peloton.
105km - The riders are onto a favourable plateau ahead of the second climb of the day. One of the favourites for the stage win - and perhaps the overall - is Katusha's Joaquim Rodriguez. "Today will be difficult. The Alto de Arrate is a beautiful climb and with the enthusiasm of the Basque fans it will be a great spectacle - but there will be no major time splits. That said, someone could well lose the Vuelta today," he said at the start of today's stage.
110km - There was a slight split in the peloton on that first climb but it's now back together, with Movistar still setting the pace. The leaders have 2:55 over the bunch.
115km - Sergio Carrasco picked up a puncture on the descent but the Spaniard is now back with the leading group. The average speed for the opening hour of racing today was 37.1km/h.
120km - The lead is still around the 3:10 mark as the temperature rises to 37 degrees now. Let's finish our round-up of riders: Dutchman Pim Lithgart is a 24-year-old former national road race champion from 2011. The promising rider topped the youth classification in last year's Tour of Belgium. Finally, 25-year-old Andrey Zeits has been at Astana throughout his professional career. Last year, he was second overall in the Tour of Turkey.
122km - Order over the Cat.2 Alto la Aldea: 1. Pim Lithgart (5pts), 2. Philippe Gilbert (3pts), 3. Andrey Zeits (1pt). That puts the Vacansoleil-DCM man into pole position in the king of the mountains competition.
124km - We have two Francophone riders in the group too: Canadian Dominique Rollin is a former national road race champion and joined FDJ-BigMat in 2011 after a couple of years at the now-defunct Cervelo. In 2008, Rollin won the opening stage of the Tour of California. Frenchman Christophe Riblon has been at Ag2R all his career and won a stage of the Tour de France in 2010.
125km - Two Belgians are in this break too. Veteran Nico Sijmens joined Cofidis in 2009 and has numerous low-key wins to his name at Pro Continental level. This year, the 34 year old won stage two of the Boucles de la Mayenne race. His compatriot Philippe Gilbert has the most impressive palmares amongst the leading group - although the 30 year old is still without a win at BMC since joining in the winter following an incredible season that saw him win 18 races.
128km - There are two Spaniards in this break: Sergio Carrasco (Andalucia) and Markel Irizar (RadioShack). 28-year-old Carrasco has spent his entire career at the Pro Continental Andalucia team and is still in the hunt for his first career win. Veteran Irizar joined RadioShack from Euskaltel in 2010 and last year the 32 year old won the Vuelta a Andalucia.
130km - The temperature is up to 36 degrees and the leaders have 3:10 on the peloton, which is being controlled by the Movistar of defending champion Cobo and current red jersey Castroviejo.
134km - The eight leaders are onto the start of the first climb of the day, the Cat.2 Alto la Aldea (11km long at 3.8%).
136km - Today's climbs: Cat.2 Alto la Aldea (summit after 32km), Cat.3 Puerto de Vitoria (66km), Cat.3 Puerto de Campazar (120km) and Cat.1 Alto de Arrate (153km). There is a slightly flat run into the finish, more details on that later.
138km - The gap is up to 3:15 for the eight escapees. The virtual red jersey is that man Gilbert, still in search of his first win of the season. If this group stays out, he could be the danger man. The Belgian is currently just 10 seconds down on Castroviejo on GC.
142km - So, it looks like this eight-man group will be the break of the day. The lead is up to 2:35. They are: Sergio Garcia Carrasco (Andalucia), Dominique Rollin (FDJ-BigMat), Philippe Gilbert (BMC), Nico Sijmens (Cofidis), Markel Irizar (RadioShack), Andrey Zeits (Astana), Pim Ligthart (Vacansoleil-DCM) and Christophe Riblon (Ag2R-La Mondiale).
145km - Another four riders have joined the leaders. They are Markel Irizar (RadioShack), Andrey Zeits (Astana), Pim Ligthart (Vacansoleil-DCM) and Christophe Riblon (Ag2R-La Mondiale). They have about a minute over the peloton.
147km - It's not as hot today as it was over the weekend: the sun is out and the temperature will hit a maximum of 33 degrees Celsius in Eibar.
148km - Today's stage covers a lot of the terrain used in the spring stage race the Tour of the Basque Country. In fact, the Alto de Arrate climb above Eibar has seen Spain's Samuel Sanchez (Euskaltel) strike twice to take wins in recent years. It's a 5.5km climb with an average gradient of 7.8% so it's quite a test at this early point in the race. Sanchez is not riding in the Vuelta, but expect some of his Euskaltel team-mates to have a pop today.
150km - Defending champion Juan Jose Cobo is currently sixth place in the GC, four seconds down on his team-mate Jonathan Castroviejo. The Spaniard struggled to keep up with his Movistar team in the closing moments of the TTT on Saturday and so conceded a little time. Apparently he has been struggling with stomach troubles although he said this morning that he's now feeling much better.
151km - We now have four leaders following a counter attack from Belgian duo Philippe Gilbert (BMC) and Nico Sijmens (Cofidis).
154km - There's an early attack by Spaniard Sergio Garcia (Andalucia) and Canadian Dominique Rollin (FDJ-BigMat).
155km - They're off! Today is the Vuelta's only day in the Basque Country, an area steeped in cycling history. There will be many local riders - especially from Euskaltel - keen to contest the win at Eibar.
12:40 - The riders are onto the 3km neutral section of this stage - the race will begin in a matter of minutes.
12:35 - There are no overnight withdrawals to report so we have 197 riders taking to the start at Faustino V. On Saturday, Italian Enrico Gasparotto (Astana) was forced to pull out of the race after breaking his collarbone in three places when crashing in the TTT. The Amstel Gold winner is the only rider to have pulled out of the Vuelta after two stages.
12:30 - Jonathan Castroviejo, making his debut Grand Tour, is still in the red jersey. The Spaniard leads a cluster of his team-mates following Movistar's win in the opening team time trial in Pamplona on Saturday. But today's stage - and the bonus seconds available over the finish -= will surely shake things up. Overall standings
12:25 - Yesterday, German youngster John Degenkolb won stage two of the Vuelta a Espana as Spaniard Jonathan Castroviejo retained the leader's red jersey. The Argos-Shimano sprinter pipped experienced Australian Allan Davis (Orica-GreenEdge) in a tight bunch sprint at the conclusion of the largely flat 181.5km stage from Pamplona to Viana in northern Spain. Report: Degenkolb victorious in Vuelta stage two
12:20 - Welcome to live coverage of stage three of the Vuelta a Espana, a demanding 155km ride that includes three categorised climbs ahead of a punchy Cat.1 summit finish at Eibar. It may only be stage three, but we'll see a major selection for the GC today in all likelihood. No one will win the race today, but the Vuelta may be lost...