The Chinese land defenders were as poorly equipped as the sailors of their war junks; when they lighted their ancient matchlocks to fire them, scores of soldiers were burned to death by accidentally igniting the gunpowder spilled on their clothing. In a naval action at Anson’s Bay, the flat-bottomed iron steamer _Nemesis_, drawing only six feet of water, surprised a squadron of junks by pushing its way into their shallow-water refuge. A single Congreve rocket from the _Nemesis_ struck the magazine of a large war junk, blowing it up in a shower of flying spars and seamen. Eleven junks were destroyed, two were driven aground and hundreds of Chinese sailors were killed within a few hours. Admiral Kwan, commander of the shattered fleet, had the red cap-button emblematic of his rank shot off by the British and was later relieved of the rank by his unsympathetic Emperor. Keeshen hastened to notify Elliot that he stood ready to hand over Hong Kong and the $6,000,000 indemnity. But even the shock of defeat had not flushed the Emperor from his dream world of superiority; he repudiated Keeshen’s agreement and ordered him to rally the troops for “an awful display of Celestial vengeance.” Well aware of the hopelessness of his situation, Keeshen tried to hold out by postponing his meetings with Elliot. Elliot, not to be put off this time, countered by opening a general assault along the Canton River. Within a month, his combined land and sea offensive had reduced every fort on the water route to Canton and his ships rode at anchor in front of the city. British preparations to storm the city were well advanced when a fresh truce was arranged. The entire British force sailed back to Hong Kong, having retreated from almost certain victory. Elliot, however, felt no disappointment; he had never wanted to use more force than necessary to restore stable trade conditions. He feared that full-scale war would bring down the Chinese government, plunging the country into revolution and chaos. Hong Kong had become _de facto_ British territory on January 26, 1841, when the Union Jack was raised at Possession Point and the island claimed for Queen Victoria. Its 4,500 inhabitants, who had never heard of the Queen, became her unprotesting subjects. The acquisition of the island produced ignominy enough for both sides; Keeshen was exiled to Tartary for giving it up and Elliot was dismissed by Palmerston for accepting “a barren island with hardly a house upon it,” instead of obeying the Foreign Secretary’s orders and driving a much harder bargain.