How should we understand the fact that the Jews knew that Hz. Muhammad (pbuh) was a prophet but did not believe in him? Why did they not become Muslims?

How should we understand the fact that the Jews knew that Hz. Muhammad (pbuh) was a prophet but did not believe in him? Why did they not become Muslims?

Dear Brother / Sister,

Jews are a nation chosen by Allah and once they were, as the Quran puts it, "preferred to all other" (al-Baqara, 2/47). However, most of the Jews did not thank Allah for this bounty given to them and disobeyed Allah’s orders insistently. Some of them went too far and dared to kill the prophets sent to them. First, they killed some prophets of their own race because they came with some orders that they did not like. They wanted to kill our Prophet Hz. Muhammad (pbuh) because he was not from their race. The reason for it is explained as follows in a resource:  

"Jews believe today as they believed in the past that a prophet can come only from the offspring of Sons of Israel and that there is nobody that is worthy of being a prophet among other people."

"Jewish scholars knew the Prophet (pbuh) because they read his characteristics in their books."

"The monk Bahira, who was in the monastery during the previous visit of the Prophet (pbuh) to Damascus, had died and a monk called Nastura replaced him. It caught the attention of the monk, who was watching the caravan, when the Prophet (pbuh) sat under the olive tree. The monk called Maysara, whom he knew, and asked who the person sitting under the tree was." Maysara said,

"He was a person from Quraysh and the people of Makkah."
The monk meditated for a moment. Then, he expressed his idea, which astonished Maysara:

"Only prophets have sat under that tree up to now."
Then, he asked Maysara,
"Is there a slight redness in his eyes?
When Maysara said, "Yes", he reached his definite conclusion:  
"He is a prophet. In fact, he is the last Prophet." (Sirah, 1/130; Rawdul-Unf, 1/122)

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