Chrome Version: 53.0.2774.2 284c900d4fedb00148839403af374758df95029f-refs/branch-heads/2774@{#4} (32/64 bit)
OS: Windows (7,8,8.1,10),Linux (14.04 LTS),Mac OS X(10.10.5, 10.11.4)
 
What steps will reproduce the problem?
(1) Launch chrome, navigate to chrome://md-settings/siteSettings/popups
(2) Click on 'Add site exceptions' and add an exception
(3) Now click on 'iron icon' to open drop down list and press up/down keys from keyboard to move grey focus highlight,observe

Actual : Focus highlight does not move up and down after pressing up/down keys at first instance
Expected : Focus highlight should move up and down after pressing up/down keys at first instance

This is a regression issue, broken in 'M-53', below is manual bisect and Narrow bisect info :
Good Build: 53.0.2769.2
Bad Build: 53.0.2770.0

Narrow Bisect:
https://chromium.googlesource.com/chromium/src/+log/0ddd7e156a1db26ec0453f7e8ad16c86ec2b244f..ae33e67a1240b8bfb4b795decd20c61b6220a73e?pretty=fuller&n=50

Suspecting: r400154 from Narrow bisect

@finnur : Could you please help to reassign if your change is not the cause for this change.
 

Deleted: Actual_video.mp4 327 KB

	Actual_video.mp4 327 KB View Download

Deleted: Expected_video.mp4 348 KB

	Expected_video.mp4 348 KB View Download