Does thunderbolt 4 support display connection to LG monitor? HP EliteBook 850 G8 to LG 27UL850-W

[DD115]

The question is simple, should the notebook:
HP EliteBook 850 G8
Be able to connect to the monitor:
LG 27UL850-W (LG 27UL850-W: 27 Inch 4K UHD IPS LED Monitor with VESA DisplayHDR 400 (27'' Diagonal) | LG USA)
over 
Thunderbolt/USB Type-c
?

I've had a DELL XPS which was working with the same setup (cable, monitor), but I am not sure about the usb-c/thunderbolt version on that notebook.
If I connect the Elitebook to the monitor over the thunderbolt 4 port, it finds the monitor, the monitor charges the laptop, additional tools attached to the monitor - like keyboard are working.
BUT the screen is "damaged" see the attached picture.

Over HDMI the screen is OK.
This setup worked with the Dell 2 weeks ago.

I use the usb-c cable which was delivered together with the monitor.

[DD115]

I bought a Thunderbolt 4 cable.
It behaves the same way.

I see 3 options:
1. The monitor is broken.

2. This setup is not supported.

3. The notebook is broken.

1. The monitor was working with the same setup/configuration 2 weeks ago with a different notebook, so I don't think this would be the case.
2. If this setup is not supported it would be nice to learn why and which documentation says this? If I understand correctly with Thunderbolt 4 everything should work always.

3. If the notebook is broken I would assume it is a driver issue. Which official way could I bring this to HPs attention?