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UPDATE 2-Spain sells debt despite regions, recession

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* Treasury exceeds target in sale, yields mixed * Government delay on aid request hurts * Economy contracted 0.4 pct q/q in third quarter -c.bank * Regions' downgrade weighs on Spanish debt By Paul Day and Nigel Davies MADRID, Oct 23 (Reuters) - Spain sold more short-term debt than planned on Tuesday, with demand shored up by expectations the country will ask for aid after ratings for some of its most indebted regions were cut to 'junk'. The sale came as the Bank of Spain warned the economy would stay in recession in the third quarter and said the country could miss a deficit target agreed with the European Union because of lower tax revenues owing to the slump. Spain is the focus of the...

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