MUMBAI: Dalal Street is likely to get the much needed direction and stability after the vote of confidence on UPA government on June 22 this week, even as falling crude oil prices may impact positively, analysts say.

"Result of the vote of confidence on the UPA government on June 22 would be the main factor to impact the market sentiments this week," brokerage firm Bonanza Portfolio President, Research, P K Agarwal said.

"The surge in crude oil prices has softened which affected the market positively and if the political situation remains stable, a good rally can be witnessed during the week," he added.

Analysts believe the market, which has been beaten down severely in the past few months, may witness a strong rally if the political situation stabilises even as movement of crude oil prices and fears of further monetary tightening by the Reserve Bank of India may continue to haunt the sentiments.

"Market is likely to remain range bound and may consolidate this week...but with a higher degree of volatility due to uncertainty on the political front and the global oil prices," domestic brokerage firm SMC Global Vice-President Rajesh Jain said.

After falling to a low of 12,514.20 last week, the BSE benchmark index, Sensex, closed with a gain of over 500 points at 13,635.40 on Friday, while the 50-share index Nifty settled at 4,092.25, up 145 points.

Last week, the market had witnessed renewed buying as global markets surged owing to fall in crude oil prices indicating signs of abatement after hitting a record high of 147 dollar per barrel.

The government is holding a two-day special session of Parliament from July 21 for the purpose of the vote of confidence, after it was reduced to minority following withdrawal of support by Left parties on July 8.

Besides, with the onset of the corporate earnings session and IT companies coming out with better than expected results, the market may perform on the positive side, analysts believe.

Pharma major Dr Reddy's, car market leader Maruti Suzuki, Tata group firm Voltas, HDFC and SAIL among others are scheduled to announce their first quarter results this week.

Inflation was quoted at 11.91 per cent for the week ended July 5, just above the previous week's annual rise of 11.89 per cent. It is the highest reading since annual numbers in the current series became available in April 1995.

The rise in inflation is the key concern for the government and the central bank has taken measures to control it. RBI is also likely to take some further action at its forthcoming quarterly review of the credit policy on July 29.

Marketmen also said that in spite of the recent sharp fall, crude oil price is still up about 35 per cent in the year 2008 so far which would continue to impact the Indian economy.

Foreign institutional investors (FIIs) continued to sell shares this week with a net sale of Rs 2,235.70 crore so far in July. In the entire year so far, FIIs have sold shares of worth over Rs 27,701 crore. On the other hand domestic mutual funds have bought shares worth Rs 522.90 crore in July so far.