Construction Zone

Simplified, I think Shylock is a racist stereotype written as a human being with actual understandable motivations because Shakespeare was a genius and fleshes out his stereotypes that way. But he was writing in a context where the audience simply LOVED their Jewish villains - an earlier stage hit had been Marlowe's The Jew of Malta, the main character of which betrays, poisons and pimps, every antisemetic stereotype in the book - and where the people cheered the execution of Elizabeth I.'s Jewish court physician on what was almost certainly a trumped up charge, only a few months before Merchant of Venice was first staged. In short, my own guess is that Burbage & Co. concluded this was the hour for a play with a Jewish villain for people to hiss at, surefire cash in the box office, and asked Will S. to write one. He made Shylock something more complex because of his writerly skills, not because Shylock was actually intended as something to COUNTER that stereotype, let alone as a genuine plea for tolerance.

The film version you saw is interesting but suffers a bit, imo, from the director wanting to have his cake and eat it. I've written a post about it here.