Mohamed A. El-Erian, chief economic adviser of Allianz, said the recent sell-off in global equity markets is a result of markets realizing that there's little central banks can do to support stock prices and when fundamentals take over prices will drop.
"The equity market is realizing there is a limit to what central banks can do when fundamentals are jittery," El-Erian said in a "Halftime Report" interview.
Fundamentally, this is what happens when you get technical overshoots. We're going to continue in that mode for a while. It's going to be extremely choppy," he added.
Part of the market pressure comes from the weakening economic situation in Europe. El-Erian said there is little that European Central Bank chief Mario Draghi can do on his own to solve the problem.
"He needs Germany to become more dovish," El-Erian said, referring to the country's reluctance to risk a deficit for the sake of stimulus.
Read MoreLive blog: Markets in turmoil