Unable to use MSAL Desktop Apps that use localhost from Azure Storage Explorer and SQL Server Mgmt Studio

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When trying to connect from Azure Storage Explorer (v1.33.0) or SQL Server Management Studio (v20.0), I am unable use Azure authentication. I get redirected to Edge to select my Azure account at

https://login.microsoftonline.com/organizations/oauth2/v2.0/authorize

and then am redirected to a

http://localhost:65389/?code=xxxxx

page which fails.

It looks like the initiating application was supposed to listen on http://localhost:65389 but was not able to start the listening process. Note that the port number is random and changes on each request.

The application returns the following error message:

Unable to sign in: An HttpListenerException occurred while listening on http://localhost:65389/ for the system browser to complete the login.
Possible cause and mitigation:
The app is unable to listen on the specified URL; run 'netsh http add iplisten 127.0.0.1' from the Admin command prompt.

This has been a long-standing issue which has been a problem for over 1 year across lots of versions of these applications. I have tried adding the following, but nothing has worked.

netsh http add iplisten 127.0.0.1
netsh http add iplisten 0.0.0.0
netsh http add iplisten ipaddress=::
0

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