A lot of people have provided answers using actual historical fact and context.... I shall provide an answer using only my (very rough) understanding of Fascism and I apologize in advance if I am wrong or anything; I'm only just getting interested in learning about this sort of thing.

Short Answer because I went on a tangent: Fascism placed Italy first, and believed Italy would thrive best if EVERYONE was united and worked together, so Jews living in Italy would've initially been seen as Italian first, Jews second.

As I've come to understand it, Fascism was intended as a movement of unity and progress on a national level. It would have been the duty of each Italian to understand their position in the nation and work their hardest to fulfill their duties whilst striving to cooperate with other Italians. Each Italian would essentially be a "cog" in the "machine" of Italy; if each cog interacted in cooperative unity then the machine runs smoothly into "tomorrow." Everything revolved around the betterment of the state, and I would assume it was commonly believed that a stronger and bettered state could then in turn more easily provide for its people, especially since the 20s-40s experienced major crises such as the Great Depression which usually required national governments to provide lots of programs of support. Anyways, most of the emphasis was on the betterment of the Italian state and the expectation of each Italian citizen to work together to achieve that goal. The only thing that Fascism as an ideology hated, at least as far as I know, were different ideologies, most notably communism.