They had feelings for each other before Serena initiated the sex between them. As June walked into Nick's loft behind Serena, her inner voice wondered why this was the first time she felt like she was cheating on Luke. So she actually 'fancied Nick' before the sex (remember the 'ten signs he likes you' inner voice time in the kitchen?).
During the first sex, although it was weird, watched by Serena, etc, they both 'felt' something - the camera focuses on their eyes closing and hands clutching at each other. It was definitely June who went back to Nick the second time, and she started taking his shirt off and initiated the passionate sex that they had that second time. She orgasmed twice, her inner voice said with satisfaction.
Their passion for each other is portrayed as very real. They love each other. June's hesitation to say it back stems from her knowledge that she is still married to Luke and they have Hannah. I think her passion or sexual feelings for Luke are no longer there - all that has transferred to the man who's kept her going in the Gilead hell - Nick. She still loves Luke, but in a way, he betrayed her too when Gilead was rising and taking her rights and Luke wasn't that fussed - and she doesn't feel the same about him now. She feels the love of responsibility, loyalty and old affection. It's just been too long and she's been through too much that he doesn't know about. Nick knows, and understands - that's a powerful bind between them. She couldn't forget all that and go back to Luke as if nothing had changed.
Max Minghella who plays Nick talks about how his character can't say much, and he has to stay discreet, because if he's found out by the Waterfords they can have him killed. So he has to play it very shut-off and deadpan, and do a lot with his eyes. That's Nick's situation. He's an eye, and can bend certain rules, but he's not totally safe - so he can't let them know. He risks a lot by showing any care or affection for June, and knows it. Also, he and the Martha found the previous handmaid hanged in her room, so he's trying to protect her because of that.
That's why Nick should stay in the rest of whatever they do with June and her story through The Handmaid's Tale. She's been through so much trauma, and losing Nick would not be something she could deal with at all. He's her anchor through the whole storm.
At least I bloody hope so, lol. I think they'd be fools to ditch Nick. Their story is the only uplifting thing about it - without their relationship, however rough it is, the whole show is just a grim nightmare. We need some hope!