Update Wednesday 7:45am AEST
Microsoft has advised that this issue is resolved

Update Tuesday 11.30am AEST from Microsoft:
Title: Can't access Microsoft 365 services User Impact: Users may be unable to access multiple Microsoft 365 services. More info: Users may be unable to access any services that leverage Azure Active Directory (AAD) including Outlook, Microsoft Teams and Teams Live Events as well as Office.com. Additionally, Power Platform and Dynamics365 properties are also affected by this incident. Existing customer sessions are not impacted and any user who is logged in to an existing session would be able to continue their sessions. 

Current status: Our mitigation strategy was successful in allowing users to sign into the previously impacted services. Our internal monitoring has validated this recovery and we have received positive confirmation from customer reports. We'll continue to monitor the service and provide updates on full recovery to remaining impacted users. 

Scope of impact: Any user may experience access problems for Microsoft 365 services. 

Start time: Tuesday, September 29, 2020, 7:25 AM (9/28/2020, 9:25 PM UTC) Root cause: A portion of our infrastructure was not processing authentication requests in a timely manner and preventing users from being able to access multiple M365 services. 

Next update by: Tuesday, September 29, 2020, 12:00 PM (2:00 AM UTC)

Original post:

Many users a reporting an Office 365 outage this morning. Microsoft has acknowledged that there is a system wide outage. It seams that if you were already logged via Outlook for example in you may be OK (so don't close outlook or restart your phone if its working!). If your Outlook was closed and you try to reconnect you may get an authentication error.

I will update this post when I know more. Some users are reporting that the issue is resolved for them already.