Re-Watching the first season of BBC Sherlock

I have a question about the season finale banter where Moriarty is teasing Sherlock. (I'll post inside to avoid spoilers for those who might not have seen it yet.)

• When he first meets Sherlock, Moriarty does the gay-baiting closet boyfriend act with Molly Hooper, knowing that Sherlock would pick up on his "gay" vibe- or maybe to test his perceptive abilities. But did M. actually suspect that Sherlock might be gay and this would intrique him or make him slip up, or did he think Sherlock would simply mock and then dismiss "Gay Jim from IT"? What was the deal there?

• He wanted to humiliate Molly.