Hast thou not turned Thy vision to those who were given a portion of the Book? they believe in sorcery and Evil, and say to the Unbelievers that they are better guided in the (right) way Than the believers!
Abdullah Yusuf Ali writes,
The word I have translated Sorcery is jibt, which
may mean divination, sorcery, magic, or any false object
of belief or worship, such as an idol.
The word I have translated Evil (here and in 2:256) is
Taghut, which means the evil one, the one who exceeds
all bounds, Satan: or it may refer to some idol
worshipped by the Pagan Arabs, with whom the Jews of
Madinah were intriguing against the Holy Prophet.
The Jews had taken much to sorcery, magic, divination,
and such superstitions.
Yusuf Ali, Abdullah. Translation and Commentary of the Quran. Microsoft Word – 004 Nisa’.doc (quran4u.com)