How can pilots lacking instruments interpret vectors given by ATC?
14 CFR Part 25 describes the requirements for an airliner like the 737 to be certified by the FAA.

§25.1303   Flight and navigation instruments.
(a) The following flight and navigation instruments must be installed so that the instrument is visible from each pilot station:
...
(3) A direction indicator (nonstabilized magnetic compass).

Indeed the 737 has a magnetic compass, centrally located above the windshield. It's just hard to see in the picture you have, as it's hidden behind the overhead console controls. This is a very typical location for the compass in many large aircraft (but not all), as it's centrally located, allows both pilots to see it, and will have less interference from other instruments.

Even the newest version, the 737 MAX, has a compass.

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