Using New Outlook on Windows for personal email, calendar, and contact management
Hopefully the password in the email is a really, really old one or one you never used with the Microsoft account. They get the passwords from hacked databases and either hope it works on email or will send blackmail emails hoping to scare you into paying them so they won't tell your contacts about all the naughty things they want you to believe they recorded (but did not - its all a lie).
Did you look for the messages in the deleted items folder or recovery folder at the top of the deleted items? Hackers will often delete mail after gaining entry. Check the recent activity at https://account.live.com/Activity - if there is any you don't recognize, the account was hacked.
Hackers will often create rules to forward mail so they can still monitor your mailbox after you change the password. When their mailbox is full or the host closes the account, you'll get a bounce message.
Check for rules or forwarding in Outlook.com's Settings (gear icon) > View all Outlook settings > Mail - under Rules and also under Forwarding. Delete any you did not create.
Change your password and if at all possible, enable 2-step verification, with at least 3 forms of verification. I would also sign the account out everywhere and reset windows hello at the bottom of https://account.live.com/proofs/manage/additional
You should also create a recovery code at the bottom of that page, especially if you enabled 2-step verification. Keep the code in a safe place and don't forget where it is.