I'm unable to connect any Outlook.com accounts using Settings → More Settings → Mailboxes → Add mailbox → Outlook.

The Microsoft OAuth flow completes successfully:

I sign in successfully.
I receive the Microsoft permission (consent) screen.
I click Accept.
The popup closes.
Yahoo immediately displays: "Canceled connecting [email] to your Yahoo account."

I've reproduced this with:

Multiple Outlook.com accounts
Multiple Yahoo accounts
Chrome, Chrome Incognito, and Safari
IMAP enabled in Outlook
Yahoo permissions removed and re-authorized

Can you check the server logs for the Outlook mailbox connector or OAuth callback to determine why Yahoo is rejecting the connection?