* China equities record biggest drop in six months
* Goldman forecasts copper deficit in revised 2017 outlook (Adds closing prices)
By Maytaal Angel
LONDON, Dec 12 (Reuters) - Copper slipped on Monday, weighed down by falling Chinese equity markets and as investors took profits from gains made last week on renewed signs of economic recovery in top consumer China.
China shares suffered their biggest drop since June overnight as fresh regulatory curbs were put on trading by insurance companies and as worries about U.S. President-elect Donald Trump's China policy rattled investors.
However, prices for industrial commodities in China have soared in recent weeks on signs of growth.
Chinese producer prices rose at the fastest pace in more than five years in November, fresh data showed on Friday, supporting views that the economy could strengthening thanks to a pickup in industrial activity.
"Fundamentals have been gradually improving through the year, but (copper) has gone too far too quickly. A lot of it was technically driven and that support has now gone away, so we expect it to find a new equilibrium in the short term," said Guy Wolf at Marex Spectron.
Three-month copper on the London Metal Exchange closed 1 percent down at $5,768 a tonne. The metal has risen by about 25 percent since late October.
Hedge funds and money managers increased their bullish stance in COMEX copper to a record level for the fifth straight week in the week to Dec. 6, U.S. data showed.
Goldman Sachs on Monday revamped its copper outlook for next year, flipping from predicting a 360,000-tonne surplus to a moderate deficit of about 180,000 tonnes.
In the wider markets, oil prices surged to their highest since mid-2015, with the recently agreed cut in output by the world's top crude producers continuing to lend support.
"The current spike in oil and a stronger dollar, coupled with increasing pressure in the Chinese financial markets, should make Chinese funds more reluctant to initiate a fresh round of aggressive buying (in metals) at this stage," INTL FCStone said in a note.
Nickel pared last week's gains to close 1.5 percent down at $11,300 a tonne. The metal has been supported by a sweeping mining clampdown in the Philippine's, the top exporter of nickel ore to China.
Aluminium lost 1.1 percent to close at $1,731, lead finished the session with a 1.4 percent gain at $2,352 and zinc slipped by 0.8 percent to $2,732. Tin rose by 0.5 percent to $21,025.
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Most active ShFE nickel
Three month LME tin
Most active ShFE tin ($1 = 6.9151 Chinese yuan) (Additional reporting by James Regan in Sydney; Editing by David Evans and David Goodman)