Ellipsis drop down menu should work with both mouse and keyboard
When there are too many links to display in the SharePoint site level navigation menu for a modern Communications site, an ellipsis with a drop down menu is displayed. When you move the mouse pointer from the ellipsis to one of the links in the drop down menu, the drop down menu disappears, making it impossible to navigate. The keyboard arrow keys work correctly, but using the mouse pointer should also work. Other places in SharePoint where a navigation menu is displayed for an ellipsis work with the mouse.
Paul Donovan commented
This has been our experience also in Hub navigation. I would like to add that it appears that this behavior is caused by a gap between the ellipsis element and the resulting navigation menu. Mousing out of the ellipsis will hide the menu, so the mouse can't reach the menu without it closing.
If you have superhuman mouse navigation skills, like me, it is possible to quickly jump this gap and mouse into the menu. However, our users don't typically possess or feel the need to exercise this power, so they are going to be very confused and angry in the very near future. I am pleading for a quick resolution to this - we'll probably need to create an extension in the meantime.