For the primary hypothesis, we assume that provincial continued increasing threats reduce the local firms’ stock market performance because such circumstances can enhance the uncertainty and investors’ risk assessment. However, if such circumstances occurred in a province where shows strong economic growth, then investors will have a lower level of risk assessment to constrain the investment. Prior studies documents that long-term equity premium is related to economic growth [46,47]. Moreover, Ludvigson [48] shows that economic activities relate to consumer confidence, and Chen [49] finds that a lack of consumer confidence leads to a higher likelihood of turning to a bearish stock market. Taken together, we suppose that stronger economic growth will decrease the investors’ risk assessment by enhancing the likelihood to have a positive outlook on the future market performance. Our second cross-sectional hypothesis is as follows (in an alternative form):